Tag Archives: wall street

New Report: Wells Fargo’s at the Bottom of the Heap

When it comes to foreclosing on Californians, it looks like Wells Fargo may take the prize.  According to a report released today, Wells Fargo is responsible for more homes in the foreclosure pipeline in California than any other single lender.  

Wells Fargo is servicing the most loans, but they are providing less principal reduction to struggling borrowers than either Bank of America and Chase – who themselves should be doing more!  Wells Fargo trails behind Bank of America and Chase when it comes to the amount of principal reduction given with first lien loan modifications, according to the Monitor of the multi-state Attorneys General settlement with the five big mortgage servicers.

This is the very same Wells Fargo that just had its most profitable year ever in 2012, with earnings of $19 billion.  

The report, California in Crisis: How Wells Fargo’s Foreclosure Pipeline Is Damaging Local Communities, by ACCE (Alliance of Californians for Community Empowerment), the Center for Popular Democracy and the Home Defenders League, shows the harm coming to homeowners, communities and the economy unless Wells Fargo reverses its course and averts some or all of the impending foreclosures.  

Download the report at: http://www.calorganize.org/sit…

The report uses data from Foreclosure Radar to look at loans currently in the foreclosure pipeline in California – meaning loans that have a Notice of Default or Notice of Trustee Sale. Of the 65,466 loans in the foreclosure pipeline, close to 20% of them are serviced by Wells Fargo.

If Wells Fargo’s 11,616 distressed loans go through foreclosure, California will take a next $3.3 billion hit: Each home will lose approximately 22 percent of its value, for a total loss of approximately $1.07 billion; homes in the surrounding neighborhood will lose value as well, for an additional loss of about $2.2 billion; and government tax revenues will be cut by $20 million, as a result of the depreciation.  

And not surprisingly, African American and Latino communities will be particularly hard-hit. The report includes maps for seven major cities showing minority density and dots for each of Wells Fargo’s distressed loans. In city after city, they are heavily clustered in neighborhoods with high African American and Latino populations.

“My community has been absolutely devastated by the foreclosure crisis, and I put a lot of the blame at the doorstep of Wells Fargo,” says ACCE Home Defenders League member Vivian Richardson.   “Wells Fargo’s heartless and unfair foreclosure practices are sending far more homes into foreclosure than is necessary.”  

“Our communities and our entire State are still reeling from the housing crisis, and will be for years to come,” said San Francisco Supervisor David Campos.  “As this report shows, the numbers of homes still facing foreclosure is enormous.  Principal reduction is clearly a critical strategy for saving homes and stabilizing the economy.  Wells Fargo and the other major banks should be doing more of it.”

The report recommends:

1. Wells Fargo should commit to a broad principal reduction program.  

This means that every homeowner facing hardship should be offered a loan modification, when Wells has the legal authority to do so. The modification should be based on an affordable debt-to-income ratio, achieved through a waterfall that prioritizes principal reduction and interest rate reductions. Junior liens must also be modified.

2. Wells Fargo should report data on its principal reduction, short sales, and foreclosures by race, income, and zip code.  

Wells Fargo must be more transparent about its mortgage practices. The bank has an egregious history of harming California’s African American and Latino communities through predatory and discriminatory lending. To show the public that it has reformed, Wells Fargo must make this data available. The people of California need to know that Well Fargo is no longer discriminating against people of color and is fairly and equitably providing relief to homeowners and to the hardest hit communities.  

3. Wells Fargo should immediately stop all foreclosures until the first two demands are met

In the event that it takes a few months to set up a fully functioning principal reduction program, Wells Fargo needs to immediately stop all foreclosures. Wells Fargo has done enough harm. It’s time to stop. California deserves a break.

ACCE is waging a campaign to push Wells Fargo to be a leader in California, their home state, in saving homes – beginning with their performance to comply with the Attorneys General Settlement and with the Homeowner Bill of Rights, but not ending there.  

To sign on to a letter to Wells Fargo CEO John Stumpf to support the campaign demands, click here: http://salsa.wiredforchange.co…

ACCE is a multi-racial, democratic, non-profit community organization building power in low to moderate income neighborhoods to stand and fight for social, economic and racial justice. ACCE has chapters in eleven counties across the State of California. For more information visit http://www.calorganize.org/ or follow ACCE on twitter @CalOrganize

Millions in Prop 30 Tax Revenues Will Be Diverted from Higher Ed to Wall Street, Thanks to Regents

Cross-posted from Firedoglake and Dog Park Media.

Millions of dollars in new tax revenue earmarked for the University of California system as part of the state’s recently passed Proposition 30 will instead be routed to major financial firms, because of bad bets made by a Wall Street-influenced UC Board of Regents.

Over the last decade, tuition and fees for undergraduates in the UC system have tripled, adding enormous debt burdens to UC graduates and pushing lower-income students into the already overburdened state college and community college systems, or out of higher education altogether. Members of the UC Board of Regents, which governs the system and which approved the tuition hikes, have blamed the increases on the bad economy and on politicians.

However, according to a new report written by five doctoral students at UC Berkeley, in the years preceding the 2008 financial collapse, members of the Board of Regents themselves had overseen “a qualitative shift in the financial practices of the University of California” by employing the same kinds of exotic financial instruments that precipitated the meltdown on Wall Street – primarily, bond issuances hedged by interest rate swaps.

An interest rate swap is essentially a bet that interest rates will rise. UC would issue a bond with a variable interest rate, then make regular payments to a third party (typically an investment bank) based on an agreed-upon fixed interest rate. The bank would then pay back to UC a dividend based on the variable interest rate of the original bond, if the variable rate were higher than the fixed rate. If the variable rate were lower than the fixed rate, then the money would go the other way: UC would owe money to the investment bank.

Between 2003 and 2007, the report explains, UC acquired interest rate swaps with five investment banks in order to issue over $600 million in bonds to finance development of medical centers on three campuses. Medical schools and hospitals are major profit centers for universities. As UC used debt financing to expand these profit engines, tuitions for students continued to rise. Since the risky contracts the Board of Regents entered into were made possible by the collateral afforded by UC student tuition costs and by the Board’s ability to jack up tuition and fees at its discretion, the same students whose ballooning debts and tuition payments to the university were making the UC system’s exotic financial bets possible were receiving no tuition relief from the university out of the profits generated by those bets.

The result of these complicated arrangements has become a familiar story since the 2008 meltdown. The Board of Regents’ pursuit of cheap money to increase UC profits left it exposed to the financial collapse. According to the report, UC’s risky bets have now cost it $57 million, which could rise to over $250 million over the next three decades. Between May 2007 and the end of last year, the Regents doubled UC’s debt load. The UC system is currently paying about three quarters of a million dollars per month to Wall Street firms as a result of the swaps.

Moreover, the LIBOR scandal earlier this year demonstrated that Wall Street bets against rising interest rates were in fact fixed by the banks. All of the interest rate swaps described in the report were based on variable rates determined by LIBOR. Through market manipulation by the banks, UC’s bets were guaranteed to be a raw deal for students, their families, taxpayers, faculty, university workers and anyone else associated with the university.

Like many other ripped-off institutional counterparties to LIBOR trades, UC has standing to sue the banks. But the Regents have not only failed to do so, they haven’t even tried to renegotiate the terms of their agreements, as other institutions have successfully done. The question is, why?

“UC Regents and management have provided no explanation for why they are not re-negotiating or litigating against Wall Street to re-coup losses on these swaps stemming from the banks’ illegal interest rate manipulation,” said Charlie Eaton, a UC Berkeley Sociology graduate student and one of the authors of the reports.

One possible answer is another sadly familiar story: The UC Board of Regents has become what the report describes as a “revolving door with Wall Street.” An increasing number of posts in top UC management and on the Board of Regents have been filled by former Wall Street bankers, the report explains, including a new CFO position created in 2009 and filled by Peter Taylor, who was the Managing Director of Public Finance for Lehman Brothers before he found himself out of a job following the firm’s spectacular collapse. Monica Lozano, a UC Regent, also serves on the Board of Bank of America, a position for which she has received approximately $1.5 million. Bank of America stands to make as much as $28 million from an interest rate swap at UC San Francisco, according to the report. B of A is also one of the banks under investigation for LIBOR manipulation.

Prop 30 was passed last week by California voters in part to stem the tide of perpetual tuition hikes and the rapid decline of public higher education in the state. But because of the Regents’ predilection for gambling with student tuition money, much of that new tax revenue will be routed away from tuition relief and toward the very Wall Street firms that – with the Regents’ help – created the financial crisis that accelerated the higher education crisis in California in the first place.

Since its founding, the UC system has always played a central role, both structural and symbolic, in making the California Dream possible. Over the last decade, it appears that the Regents leveraged that dream to make the UC system a player in Wall Street’s casino economy. As with any casino, the game was fixed. Now the rest of us are being forced to pay for their mistakes.

Proposed Foreclosure Settlement Would Benefit Wall Street, Not Main Street

by Art Pulaski, California Labor Federation

This week, the U.S. Department of Housing and Development (HUD) and the Big Banks teamed up to propose a multi-state settlement to address the foreclosure crisis. But based on the terms described in numerous media reports, the deal appears to be a settlement for the banks, not a settlement for the middle class. The people of California need real relief, not a quick settlement that lets the banks off the hook.

California is home to nine of the ten cities that were hardest hit by the foreclosure freefall. The two million working families we represent have been at the epicenter of this crisis. Millions have been devastated by the loss of their homes. Many more have watched their home values plummet and now nearly one in three California borrowers are underwater, owing more to the banks than their homes are worth. California has the second highest foreclosure rate in the country, surpassed only by Nevada. For these reasons, our stake in the outcome of the settlement talks is great. Our families, our communities, our government and our economy depend upon a fair outcome.

Taxpayers revived the Big Banks from their self-inflicted crash with a $700 billion bailout in 2009. With the infusion, banks were directed to help homeowners recover from the mortgage crisis they created. Instead, bank executives took the money in big bonuses. The greed boggles one’s mind. Some should go to jail. Instead they again want to pay pennies on the dollars they took while foreclosing on millions of California homes.

On every level, the proposed settlement is inadequate: The total settlement amount is expected to be just $25 billion dollars, while the nation has $750 billion in negative equity. $25 billion would not even cover the loss of home equity to California families, let alone all homeowners across the country. The settlement is expected to help a million homeowners, when more than 10 million are underwater and millions more have been wrongfully foreclosed upon. The settlement needs to be in the range of $200 -$400 billion, not $25 billion.

Even worse, we are concerned that the settlement may not even come from the pockets of those who engaged in the misconduct. If the settlement gives servicers credit for writing down the value of investor-owned mortgage-backed securities without requiring them to write down the mortgages and liens they own, it will be our public pension plans, not the banks, that will take the hit. That means the same working families who have already seen their life savings go up in smoke will now face losses in their retirement funds. Not only is this a great injustice, but it fails to enact any real penalty against the bad actors.

It is difficult to overstate the harm that has been inflicted on our economy by the financial institutions now seeking to pay a relatively small sum and receive broad immunity. Foreclosures destroy families financially and emotionally, and blighted, abandoned properties destroy our communities. Cities, counties, and the state are unable to meet the needs of our most vulnerable, while banks sit on record reserves.

 

Any settlement must provide meaningful relief to homeowners and to the economy. We urge the Deptartment of Housing and Urban Development to ensure that the rush for quick relief does not overshadow the need for an equitable settlement that provides:

  • Widespread principal reduction for California homeowners and fair redress for those who wrongfully lost their homes.
  • Reform of lending and servicing practices and penalties on those who broke the law to deter such wrongdoing in the future.
  • Real enforcement to ensure compliance.
  • Limited liability waivers for only those issues that have been fully investigated.

We stand behind California’s Attorney General, Kamala Harris, who has firmly and vigorously refused a settlement that falls far short of recovery for the state’s homeowners who have been forced into distress by the banks. And she wants to reserve the right to investigate wrongdoing in the mortgage debacle. She’s right. And we should have it no other way.

On Dec. 6th, Occupy goes “home” for the holidays

Four years ago Wall Street bankers crashed our economy after reckless gambling with our homes and our livelihoods. Then they looted our Treasury for bailouts and bonuses while their 1% allies used the economic chaos as an excuse to rob us of the investments we've made in helping every Californian achieve the American Dream. But since September 17, the simmering anger at Wall Street has found a powerful expression through the Occupy movement, massive campus mobilizations and increasing numbers of homeowners standing up to wrongful bank evictions by organizing community-led “home defenses.”

This month, the Occupy Wall Street movement is joining with brave homeowners (underwater and foreclosure victims alike), renters fighting foreclosure-related evictions, and other community members personally affected by Wall Street's greed around the country to say, “Enough is enough – we're not going to let them take our homes.” On December 6th hundreds of homeowners and renters facing foreclosure are announcing that they are not leaving when the sheriff comes. Some are even taking the bold step of moving back in to the homes from which they have been evicted. Collectively, the 99% are taking a stand against Wall Street and their 1% allies a step further by demanding negotiations instead of fraudulent foreclosures and justice instead of avarice.

Here in California, one of the path-breakers in taking this type of action is Rose Gudiel, a member of the Alliance of Californians of Community Empowerment (ACCE) and the ReFund California campaign. In October, she successfully defended her home and family from a foreclosure eviction by taking decisive action. She was arrested for protesting outside of a Fannie Mae office in Pasadena. After her arrest, Fannie Mae agreed to halt her eviction and then met with her to negotiate a modification of her loan. Other home defenses have sprouted in places such as Atlanta,Cleveland,Minneapolis and San Francisco.

25% of homeowners in America are underwater and by the end of 2012 nearly 13 million homes will be in some stage of the foreclosure process. There is no shortage of families being pushed to the brink and the December 6th Occupy Our Homes Day of Action represents the launch of an effort to support families that are ready to stand up to Wall Street. Everyone has a right to decent, affordable housing. The website, occupyourhomes.org was launched to help the 99% fight for this right. It features an online action toolkit and a “Pledge in Defense of Homes and Neighborhoods” that anyone around the country can sign as a signal of their willingness to take action in defense of their own home or their willingness to stand in solidary with others taking that bold step. The goal is to get 50,000 people to take the pledge in the coming weeks.

Rose Gudiel and others that have stood up to their banks know that eviction defenses and home occupations should not be taken on lightly. That's why the Alliance of Californians for Community Empowerment (ACCE) has put together a teach-in called “Know Your Rights: How to Defend Your Home from Illegal Bank Actions” to help would be home defenders. Most teach-ins will take place this Saturday, December 3: anyone can sign up at www.calorganize.org/knowyourrights

On the day before Thanksgiving, appropriately, Occupy Wall Street in New York announced that they were supporting December 6th as a national day of action and encouraging people across the country to defend their homes against illegal bank actions. Throughout California and across the country people are organizing a variety of actions and many will publically announce that they are refusing to leave when faced with an unfair eviction.

As OWS member Max Berger told Salon, “This is a shift from protesting Wall Street fraud to taking action on behalf of people who were harmed by it. It brings the movement into the neighborhoods and gives people a sense of what's really at stake.”

Are you ready to be the next Rose Gudiel? Are you ready to stand by a neighbor or friend that is resisting a wrongful foreclosure? Sign up for a teach-in at www.calorganize.org/knowyourrights and then take the pledge at occupyourhomes.org

Bank of America – A Unique Display of Corporate Greed

by Mitch Seaman, California Labor Federation

Forbes magazine as gutsy consumer advocate? Well, not really, but even the favored rag of corporate shills everywhere seemed stunned by Bank of America’s $5 debit fee announcement on Friday, accusing the banking behemoth of committing

a common mistake large corporations make: taking the customer for granted, holding the belief that whatever products or services they offer are unique and indispensible, so their customers will always be there.

While we agree that Bank of America’s incompetence runs rampant throughout the banking industry, by several measures of greed and arrogance, this troubled corporation stands alone. Allow us to present Bank of America with the following uniquely dubious titles:

Greediest TARP recipient: Bank of America took tens of billions of taxpayer dollars from the Troubled Asset Relief Program (TARP) in 2008. This bailout was supposed to help shore up the entire US financial system—as banks can be too big to fail but never too big to take free taxpayer money. Anyway, the terms of these loans required recipient banks to individually maintain sufficient cash to ward off a broader Wall Street meltdown. However, as last week’s Special Investigator General (SIGTARP) report confirms, Bank of America lobbied heavily to escape the program before they’d achieved the required financial reserves. Why? According to the report, Bank of America cited “…concerns including market perception and restrictions established by the Special Master for TARP Executive Compensation.” In other words, a shaky Bank of America weaseled out early to polish its image and pay executives more—jeopardizing the fiscal health of their company and the stability of our country.

Downsizer of the year: This one wasn’t even close. On September 12th, Bank of America CEO Brian Moynihan announced 30,000 layoffs—that’s more than twice the number of layoffs (13,000) declared by 2011’s second-place downsizer, pharmaceutical titan Merck & Co. Bank of America’s bombshell dropped just one month after Moynihan informed investors that “our capital levels are among the highest they’ve ever been in this institution’s history.” Maybe he’s confusing “our” capital levels with his capital levels: last year, Moynihan collected $2 million of his $10 million 2010 total compensation package. Other executives, in some cases, collected even more. Thomas Montag, head of investment banking and capital markets, will rake in $16 million for his work in 2010. Not bad for tanking one of the biggest banks the world has ever seen, though we have to wonder, how many jobs could be saved by firing these two alone?

#1 Tax Cheat: If you paid any federal income taxes at all last year, you paid more than Bank of America. In fact, unless you got a refund check bigger than $1 billion, you paid more taxes than Bank of America. It gets worse: these freeloaders paid no taxes last year and likely won’t for a long time. Chew on that next time pro-banker legislators demand we balance the budget through Social Security and Medicare cuts from middle class families.

First in Fees: All of which leads up to the latest Bank of America gaffe: the unprecedented $5 monthly debit fee slapped on any customer guilty of using his or her debit card for its intended purpose of buying things. This charge comes courtesy of a bank that for years encouraged frequent use of and zealous devotion to debit cards—mainly to help the bank rack up sky-high “interchange” fees from merchants on every card swipe. The company changed their tune, however, following federal legislation requiring that fees be “reasonable and proportional to the cost incurred by the issuer with respect to the transaction.” Apparently, despite final federal rulemaking that more than doubled the fee limit set by Congress, reasonable and proportional profits just aren’t enough for this champion profiteer—hence the shocking new fee.

While we applaud the furor over the monthly debit charge, be sure to consider this fee just the latest of many anti-consumer and anti-worker moves from the king of both. We’ll go to another surprising Forbes magazine masterpiece for the final word: “Banks aren’t our friends.” From one friend to another, we couldn’t agree more.

On Bilking The Sophisticated, Or, Check It Out: We’re Suing Banks!


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I took a break to enjoy the holiday, as I’m sure many of you did, but my inbox kept busy, and on Friday came a doozy, courtesy of the Washington Post.

You remember that little bit of a banking crisis we had a couple of years back, where banks around the world might have possibly, maybe, just a little, conspired in a giant scheme to package toxic mortgage loans into Grade A, investment-ready securities instruments, which then blew up in everyone’s faces to the tune of a whole lot of taxpayer bailouts?

Well all of a sudden, it looks like an agency of the Federal Government is looking to do something about it, in a real big way.

Last Friday the Federal Housing Finance Agency (FHFA) announced they’re suing 17 firms (I’ll give you a list, bit it’s pretty much all the usual suspects); depending on who you ask the Feds are seeking an amount as high as $200 billion.

As Joe Biden would say, it’s a big…well, it’s a big deal, anyway, and that’s why we’re starting the new week with this one.

“An artist is only answerable to himself. He promises nothing to the centuries to come save his own works. He stands caution only for himself. He dies childless. He has been his own king, his own priest, and his own god.”

–Charles Baudelaire, as quoted in the book Cezanné and Beyond, edited by Joseph J Rishel and Katherine Sachs

So what do we know?

As we said, on Friday the Washington Post and others reported that there were a series of lawsuits filed by the FHFA in their capacity as Conservator of the assets of Fannie Mae and Freddy Mac against darn near everyone.

The FHFA is alleging, to make a long story short, that everyone involved misled Fannie Mae or Freddy Mac (the “Entities”, in the words of the lawsuits), to some extent, and that the misleading involved making representations to the Entities about the various metrics related to what Fanny and Freddy were buying from these banks.

For example, it’s alleged that when certain banks sold batches of mortgage loans to the Entities, they lied about how many of the owners were actually living in the homes; that makes a difference when you’re trying to figure out how likely a borrower is to pay back a loan.

It appears that a defense the banks will offer is that Fannie and Freddy were “sophisticated investors” who should have known the risks buried in the batches of loans they were buying (and they were sophisticated investors: they bought, literally, trillions of dollars worth of loans) – but if it can be proven that the banks were lying about what was in the loan packages, that defense might not do so well in front of a jury.

Everyone involved” includes Bank of America (B of A), Citigroup, JP Morgan Chase, Countrywide (which means B of A is actually being sued twice), Deutsche Bank, Credit Suisse, the UK’s HSBC and Barclays Banks, France’s Société Générale, the Royal Bank of Scotland, Nomura Securities (representing Japan), and GE and GM (GE Capital is a surprisingly large and varied business; GM got in the banking business to finance auto sales, and you may today know them as Ally Bank).

Of course, Wall Street is also part of “everyone”; that’s why the list also includes Goldman Sachs, Morgan Stanley, and Merrill Lynch (which means, thanks to acquisitions, that B of A is actually getting sued three times). The City of Memphis also proudly makes the list, thanks to First Horizon.

Some notable names not on the list? Key Bank and Wells Fargo, who seem to have escaped action so far; there’s also UBS (Union Bank of Switzerland), who was already served with a similar lawsuit in July.

It is difficult to determine exactly how much money is involved, as various sources disagree, but we know that Deutsche Bank is being sued for about $14 billion, all by itself. (B of A is being sued, all told, for a bit over $50 billion; they’ve already paid out more than $12 billion this year to settle another similar claim.)

Felix Salmon, at the Seeking Alpha website, has created a chart that seeks to measure who is in the most trouble here; by his measure JP Morgan Chase is far and away at the top of the list…except that the current incarnation of B of A represents three of the top eight spots on his list, which suggests the FHFA is targeting them for the most recovery. (Salmon used the number of individual defendants, how many pages were in the lawsuit, and whether the suits seek punitive damages as his yardsticks; from there he calculated a score that makes up his rankings.)

All this had to happen right now, it appears, because a statute of limitations is in play; the WaPo reports that a failure to file the suits would have meant the FHFA would have lost the ability to recover those monies. (It’s also reported that pre-lawsuit negotiations were stalling, and those negotiations will presumably continue, with a series of impending court dates to help, shall we say, sharpen the focus.)

Now that is pretty much all the story I have for you today on this one – except for a bit of a “discuss amongst yourselves” to finish things up:

It has been suggested that the FHFA is in an inherently conflicted position in all these cases. That’s because the agency is acting as both the regulator of these banks and the “victim” as we seek any monies that may be due from any fraud.

So what would be a better situation?

Should the FHFA continue to regulate the banks they’re suing as a victim, or should another regulator be put in place…or should another Conservator be appointed, leaving the FHFA as “just a regulator”, and not a victim?

It’s a question worth about $200 billion, more or less – and even in these times, that’s still a lot of your money.

Fair Districting?

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Nurses Take On Wall Street

More than a thousand RNs and other activists marched on Wall Street Wednesday, chanting “Wall Street got bailed out! We got sold out!”

They stood on the steps of Federal Hall across from the New York Stock Exchange and held signs – “Take it Back! Tax Wall Street” and “Heal America! Tax Wall Street” – so crowds of curious passersby got the message.  

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It’s time to make Wall Street high rollers who created our economic crisis pay its fair share.

Hundreds of nurses from across the country gathered in the heart of our nation’s financial center on June 22, an International Day of Action, to make that message crystal clear.    

“It’s time for their shared sacrifice. They haven’t had any of that. They have been making billions and trillions in profit and they are not giving anything back to our community,” said Deborah Burger, RN and member of the National Nurses United Council of Presidents.

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The protest is part of the National Nurses United’s Main Street Contract for the American People’s campaign, which aims to reclaim an economy with good jobs at living wages, healthcare for all, quality education, good housing, protection from hunger, a safe environment, and a secure retirement for everyone.

The mainstream media is ignoring the real stories — the stories of people suffering from budget cuts, homelessness, and lack of healthcare.

Representatives from other community and labor organizations stood with the nurses Wednesday to show their support.

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“We are calling for a more fair and just economy,” said Karen Higgins, RN and member National Nurses United Council of Presidents.

That’s why NNU, with the support from dozens of community and labor organizations, such as the AFL-CIO, United Auto Workers, and Transport Workers Union Local 100, are calling for a Wall Street tax on financial transactions.

“It’s very American…Just like working people pay taxes on all of their purchases. These corporate speculators who buy and sell and buy and sell our country should pay a minimum tax on that,” NNU executive director RoseAnn DeMoro explained to the crowd. “A very minimum tax could amount to at least $350 billion every year that can go back to our communities and go back to jobs and go back to healthcare.”

Similar events, called by the European Trade Union Confederation, were taking place in 35 other countries in support of a similar tax there. The nurses led the protest in America.

The hour-long rally ended with songs of solidarity.  The nurses and fellow community activists left Wall Street — waving their signs and yelling “This is what democracy looks like!”

Bystanders joined in the chant as the sea of red scrubs moved down the street.

Wall Street Attacks Your Garbage Collector

The wealthy right wing have always liked to pick on the working class. And now Wall Street wants to blame Main Street for the financial crisis our country is in. Big bankers taking home large bonuses are blaming the childcare workers and parking-meter collectors in this country, saying that their jobs are the reason we’re in a recession.

If you stop to actually look at the people and jobs Wall Street is attacking, you realize that we need to stop the lies. Public-service workers make little money and do the hard jobs necessary to keep our country running.

In 2009, public service worker Joe Wisniowski made $40,000 as an Airport Equipment Operator for an Ohio airport. Meanwhile Wall Street raked in $20.3 BILLION in bonuses during the same year.

As Robert Bonds, a parking meter collections assistant in Detroit, puts it: “What is this teaching my son? You can work hard, go to college to get your degree, and it’s all out of your hands; your success is based on somebody sitting in an office somewhere on Wall Street… that’s not what I want him to believe.”

Public-service workers are coming under attack like never before. Wall Street has the money, the power and the media mouthpiece to spread lies about those who serve our country in necessary jobs. We can’t let Wall Street destroy the backbone of America. Join with us to defend public service workers.

On Slicing Pies, Or, Mystery Fees Cause Retirement “Money Spill”

It’s part two of our “Netroots Nation Goes To Vegas Piano Bar Extravaganza”, and in keeping with tradition that means we are again taking a story request.

This time we won’t be talking about energy security or “climate security”; instead, we’ll discuss retirement security, keeping your money for yourself instead of paying it out in “mystery fees”, and how one of the “usual suspects” is at it again.

And if all that wasn’t enough…we also have pie.

And when the Pye was open’d

The birds began to sing,

And was not this a dainty dish

To set before the King!

–Charles Lamb, writing to Miss Sarah James, April, 1829

So here’s what’s going on: about 50 million Americans have one of those 401(k) retirement plans.

The concept behind these plans is that you put money into an investment account of some sort, and the money accumulates, tax-free, until you withdraw it after you retire.

These accounts are “managed” by financial services firms, who collect fees for the service.

Lots of fees, for all kinds of services.

The problem is that not all of these fees are fully disclosed to investors. In fact, it’s legal for an investment firm to deduct some amount of money out of the mutual fund that you’ve put your money into…and not tell you how much they took.

Part of the House’s vision of financial reform legislation requires the managers of these monies to fully disclose, up front, before you invest, and on every statement afterward, what fees are being collected; an amendment before the Senate would remove this protection-and here’s where the “usual suspects” part comes in: we have this amendment thanks to our good friend…wait for it…Senator Max “I love healthcare reform-as long as those healthcare industry checks keep coming in” Baucus, he of the Senate Finance Committee.

The US Department of Labor says that you could lose as much as 28% of your money, over time, to these hidden fees, and that’s a pretty big slice out of your retirement pie.

To illustrate the point Congressman George Miller, chair of the House Committee on Education and Labor (following the requisite press conference) dispatched his minions to deliver 72% of an apple pie to each member of the Senate Finance Committee Wednesday, as you can see in this video, courtesy of Mr. Miller’s office:

What about the other 28%?

That was replaced with a big red wedge that reads “Wall Street’s Cut of Your 401(k) Pie” before the pies were boxed up…and it was actually a nice presentation, if I may say so myself.

So exactly who got the pies?

With no effort made to change the names for the protection of the innocent, here’s a list of the members of Senate Finance, along with their States and affiliations:

Max Baucus (Oy, Vey!-MT)

Jeff Bingaman (Big-Time Lobbyist Wife-NM)

Jim Bunning (Nutty-KY)

Maria Cantwell (Used to be Rich-WA)

Thomas Carper (Once Accused of Designing a Regulatory Deathstar-DE)

Kent Conrad (Countrywide VIP Home Mortgage Program Participant-ND)

John Cornyn (Compensating…-TX)

Mike Crapo (Big-Time Lobbyist Daughter-ID)

John Ensign (“Wanna Donate To My Legal Defense Fund?”-NV)

Mike Enzi (One of Those C Street Guys-WY)

Chuck Grassley (Against Healthcare Reform…Until He Was For It-IA)

Orrin Hatch (Supports Drug Testing For Unemployment Benefits-UT)

John Kerry (John Kerry Walks Into A Bar, The Horse Says “Hey: Why The Long Face?”-MA)

Jon Kyl (Wants Joe Arpaio to Enforce Immigration Law-AZ)

Blanche Lincoln (Damn Near Fired-AR)

Robert Menendez (Never Convicted-NJ)

Bill Nelson (Had His Own “Flight Suit” Moment-FL)

Pat Roberts (Is America’s Phone Tapped?-KS)

John D. Rockefeller IV (Actually Wanted a Public Option-WV)

Charles Schumer (Will Go Upstate-NY)

Olympia Snowe (Always the “Possible Republican Vote”-ME)

Debbie Stabenow (Can’t Live With ‘Em…-MI)

Ron Wyden (Geek-OR)

This is another one of those stories where getting ahold of one or more of these Senators, in the next few days, could matter quite a bit if it’s your pie that’s at stake…and even if it isn’t, why should fund managers get to charge “mystery fees” to anybody?

So get to it, now, because if you do, you may be able to afford more ice cream to go with your pie later.

WARNING – Blatant Self-Promotion Ahead: It’s Netroots Nation time once again, and the fine folks at Freedom To Marry have chosen me as a finalist for their Blog 4 Equality contest. If I am one of the chosen, it’s off to Vegas…in July. You can vote for that Don Davis guy here, which is my “in person” name, once every 24 hours, so vote early and often. Voting ends June 25th. Thanks very much, and we now return you to your regular programming.

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Q and A with Robert Kuttner

As the editor of Labor’s Edge, I had the unique opportunity to sit down with journalist and author Robert Kuttner at the annual ‘Building Workforce Partnerships’ conference, sponsored by the California Labor Federation’s Workforce and Economic Development Program. Kuttner is co-editor of The American Prospect and a senior fellow at Demos. His latest book is “A Presidency in Peril: The Inside Story of Obama’s Promise, Wall Street’s Power, and the Struggle to Control our Economic Future.”

See the flip

Labor’s Edge: What role do you see unions playing in our nation’s economic recovery?

Robert Kuttner: Let’s look at the 1930s — a period of higher joblessness but also a great time for union growth. It really all depends on how well-informed the workforce is. Some folks who aren’t well-educated look at public employee unions and say, “These folks have it too good.” Other more informed people look at union workers and say, “I want what they have.” It’s up to labor and political leadership to use this recession as an opportunity to educate, mobile and organize workers.

Labor’s Edge: In 2009, you wrote about the White House’s Task Force on Middle Class Working Families. What has the task force accomplished so far, and what still needs to be done?

Robert Kuttner: The task force is a good first step — it has created a new venue where the issues that matter to working families can be raised and addressed. But unfortunately, the task force is understaffed, and the proposed executive order to give contractors extra points for treating their workers well is hung up at Office of Management and Budget. We need the President to prioritize the task force himself (currently it’s being headed up by the Vice President’s program) and make it a top priority, in order to target those large, high profile companies who are low road employers.

Labor’s Edge: In terms of stabilizing the economy and reinvigorating job growth, what has Obama done right, and what still needs to be done?

Robert Kuttner: The stimulus package was a good thing — it helped create a lot of jobs. But it’s not enough; the money will run out soon and the package must be repeated. Right now, I’ll give financial reform a B+ — the bill is getting better as public understands the stakes. For his first few years in office, Obama should have been completely focused on the economy, financial reform and mortgage relief. The health care bill consumed too much time and attention and didn’t go far enough; and it could have waited until Obama’s second term. And the ongoing emphasis on deficit reduction is the wrong approach – it’s only making it harder to get other bills passed, because everyone is scared of increasing the deficit (which is actually a good thing in times of high unemployment).

Labor’s Edge: What exactly would the federal financial reform bill do? Is it enough rein in Wall Street greed?

Robert Kuttner: The Consumer Financial Protection Agency is a very important component of the financial reform package – but it needs to be a free-standing agency. In the Senate version of the bill, the CFPA lies within the Federal Reserve, but in the House version, it’s a committee of regulators, which is what we need. The “Audit the Fed” amendment is good. The derivatives reform component is also pretty good, but it could be better – there are just too many loopholes. The bottom line is that the financial reform bill doesn’t do enough to change the current business model of banks acting like hedge funds, creating exotic assets too confusing for people to understand, and profiting richly at the expense of working people.

Labor’s Edge: What do you think needs to happen to break California out of its perpetual budget woes?

Robert Kuttner: California’s budget is going to be a mess until we get rid of Proposition 13 and the supermajority requirements on budgets and taxes. As long as we have those hurdles in place, our hands will always be tied, even if we had a great Governor. But these rules have fostered a political climate that makes it easy for the Governor to impose his cuts and pit us against each other, playing welfare programs against worker pensions, and so on.

Labor’s Edge: Do you think the anti-Wall Street sentiment will carry over and affect the November election in California, in the event that we end up with two corporate CEOs (Whitman and Fiorina) at the top of the ticket?

Robert Kuttner: Well, you would think so, but I believe we need to make this an issue for it to resonate. Buying your way into public office should be politically radioactive.

Labor’s Edge: What does the BP oil spill mean for the future of the green economy?

Robert Kuttner: If there’s one thing that this oil catastrophe has demonstrated, it’s that we absolutely cannot trust the oil companies to regulate themselves and control our energy policy. We need real regulation to save them from their own greed. But there’s more to it. We can’t rely on oil in the long-term; we must shift to a cleaner, greener economy, which would benefit the workforce, environment and trade. If ever there was an impetus for the Obama Administration to make this move, the oil spill is it.

Rebecca Greenberg is communications organizer at the California Labor Federation, which represents more than 2 million workers in 1,200 unions across the state.