The OB Media Rundown for 6/21/12

Occupy Belmont and Social Action Committee plan talk on wealth and income inequality

Occupy Belmont and the Social Action Committee of the First Church in Belmont are hosting a forum on wealth and income inequality and its social consequences on Monday, June 25, at the First Church in Belmont, Unitarian Universalist.

Marjorie Kelly, author of the new book “Owning our Future: The Emerging Ownership Revolution,” will be speaking about the economy as it is today, and as it could be.

She points to a community-owned wind facility in Massachusetts, a lobster cooperative in Maine, a multi-billion dollar employee-owned department-store chain in London, among others, as examples of businesses that eschew typical ownership designs and prosper.

A conversation about Occupy Wall Street: ‘Making the impossible seem possible’

Nine months ago Occupy Wall Street set up an encampment in New York’s financial district; an action that served as an ‘opening bell’ for a movement that quickly coursed across the United States and beyond.

Since then that encampment and others have been violently uprooted by the authorities. At the same time Occupy has largely disappeared from the regular news cycle; replaced by, among other things, the deadening coverage of the U.S. elections. Yet the massive May Day demonstration in New York — with estimates as high as 30,000 people, the largest of its kind perhaps since the 1930s — made clear the underlying discontent that gave rise to this movement is still highly present.

I wanted to get a better bead on the thinking underlying this movement. So, with my recent interview with David Harvey on his book, Rebel Cities, in hand, I approached the Occupy press team. The result was a conversation with two people who have been with Occupy from its start in September 2011: Peter Rugh, a social justice activist with a focus on environmental issues within the movement, and Sofía Gallisá Muriente, a Puerto Rican woman working on the OWS print publication IndigNación, which aims to reach the Latino community.

Women Are the Biggest Losers from Failure to Raise Minimum Wage

The current federal minimum wage of $7.25 per hour is far too low. A full-time worker earning the minimum wage makes just $15,080 per year, below the poverty line for a family of three. From 1968 to 2010, incomes for the top 1 percent of earners increased by 110 percent, but the inflation-adjusted value of the minimum wage has fallen by 31 percent. If the federal minimum wage had kept pace with the rising cost of living over the past 40 years, it would be $10.52 per hour today.

Women are disproportionately harmed by a low minimum wage because women-and especially women of color-are much more likely hold low-wage jobs than men. The typical woman earns 77 cents for every dollar the typical man does, and the fact that women are more likely to be minimum-wage earners than men contributes to that disparity. This gap is especially distressing now that two-thirds of mothers are either the breadwinners or co-breadwinners for their families.

In short, the minimum wage is not just a worker policy-it is also a woman’s policy.

Housing bust still hurts Lower Ninety

Raw numbers can be striking. While Occupy Wall Street has focused on the 1 percent versus the 99 percent, the recently released Federal Reserve report on the Survey of Consumer Finances clearly shows that the Lower Ninety – the 90 percent of all households that are less well off than the top 10 percent – were hard hit by the housing bust that started in 2006 and endures today.

The study, which shows how our finances changed between 2007 and 2010, also confirms all the piecemeal reporting on foreclosures, job loss and the 401(k) plans that became 201(k) plans.
. . .

The used car market is really important. Used car prices have been rising. That’s a good thing because about 75 percent of all households have more invested in their cars than they have in CDs or individual common stocks. It also appears that nearly 50 percent of all households have more tied up in their cars than in their retirement accounts.

As schools struggle to get better, is selling out to big money the answer?

The idea of education reform has become so much of a universal social imperative that even hard-nosed liberals mindlessly dance to its alluring tune without considering the consequences of their gallivanting. For proof of this phenomenon, one simply needs to read the Boston Globe’s op-ed rants against teachers unions, or to examine the Obama administration’s cheerleading for charter schools.

Yet the big picture should be daunting to progressives. As inconvenient as it is to consider, there is a mounting body of evidence that suggests much of the so-called school-reform movement is a stalking horse for the for-profit education industry. Simply put, the same free-market-cowboy values that fueled the economic meltdown of 2008 are now occupying box seats at the school-board roundtable.

Mitt Romney’s blueprint for privatising American education

On 23 May, the Romney campaign released its education policy white paper titled A Chance for Every Child: Mitt Romney’s Plan for Restoring the Promise of American Education. If you liked the George W Bush administration’s education reforms, you will love the Romney plan. If you think that turning the schools over to the private sector will solve their problems, then his plan will thrill you.

The central themes of the Romney plan are a rehash of Republican education ideas from the past 30 years, namely, subsidizing parents who want to send their child to a private or religious school, encouraging the private sector to operate schools, putting commercial banks in charge of the federal student loan program, holding teachers and schools accountable for students’ test scores, and lowering entrance requirements for new teachers. These policies reflect the experience of his advisers, who include half a dozen senior officials from the Bush administration and several prominent conservative academics – among them, former Secretary of Education Rod Paige and former Deputy Secretary of Education Bill Hansen, and school choice advocates John Chubb and Paul Peterson.

Young Wall Street Traitor Joins Occupy Wall Street

Wall Street recruits young, just out of college computer science majors and mathematicians to become “quants” whose skills are used among other things to predict when pension funds are going to make huge trades so that Wall Street can jump in ahead of them and do deals effectively raising the price the pension fund must pay or lowering the profit they might make.

One such young twenty something quant was Alexis Goldstein. Goldstein devised trading software for Deutsche Bank and Merrill Lynch. She has divulged some of Wall Street’s most closely held cultural secrets such as the phrase “rip the client’s face off” which means selling some derivative “solution” to a naive client such as a convent of nuns in Europe at a huge profit to the trader and to Wall Street while convincing the client that it’s the best deal they ever made. Sometimes they refer to these clients as “muppets.”

JP Morgan Chase and Goldman Sachs fanned out all over Europe in the wake of the Commodities Futures Modernization Act of 2000 which legalized derivatives. The legalization of derivatives made it possible to design financial products which shifted the risks and rewards around among different clients, some seeking higher rewards at higher risk and some seeking safety with lower returns and lower risk. Derivatives could be custom designed on the trading floor taking each client’s “needs” into account.

Major Banks Largest Source Of Consumer Bureau Complaints

Major banks including JPMorgan Chase & Co. (JPM), Bank of America Corp. and Citigroup Inc. (C) were the subjects of the largest number of complaints to the U.S. Consumer Financial Protection Bureau in 2011, according to data obtained through a public records request.

Bank of America accounted for about 13 percent of the 13,210 complaints, mostly about credit cards, to the bureau between July 21 and Dec. 31, 2011. JPMorgan and Citigroup each accounted for about 11 percent, Capital One Financial Corp. (COF) represented about 8 percent, and Wells Fargo & Co. (WFC) accounted for about 5 percent. The number of complaints was roughly consistent with the size of the banks’ credit card business.

JP Morgan’s Jamie Dimon Lambastes Loans and Expresses His Devotion to Derivatives

The ongoing U.S. crisis was driven largely by financial derivatives.  Nine of America’s systemically dangerous institutions (SDIs) failed or had to be bailed out – Bear Stearns, Lehman, Merrill Lynch, Fannie, Freddie, AIG, Countrywide, Wachovia, and Washington Mutual (WaMu).  The SDI failures were primarily due to losses caused or aided by the sale and purchase of enormous amounts of fraudulent derivatives, and deregulation, desupervision, and de facto decriminalization proved exceptionally criminogenic.  The Commodities Futures Modernization Act of 2000 and the Gramm, Leach, Bliley Act of 1999, respectively, made credit default swaps (CDS) into a regulatory black hole and repealed the Glass-Steagall Act’s prohibition against banks mixing commercial and investment banking.

The Dodd-Frank bill should have repealed the two deregulatory acts passed near the end of Clinton’s term with broad bipartisan support, but the Obama administration never tried to go back to the legal governance system for finance that worked brilliantly for nearly a half-century and Jamie Dimon and JPMorgan led the lobbying blitz that ensured that the Dodd-Frank Act would have the taste, depth, and substance of light beer made by an enormous commercial American brewery.  The Volcker rule was intended to partially restore the Glass-Steagall Act by restricting banks’ proprietary derivatives investments to hedging.  The rationale was that there is no public policy basis for providing federal subsidies to banks to speculate in financial derivatives.  That public policy argument against subsidizing dangerous bets by banks in derivatives is compelling and cuts across all political spectrums.  Among banks, only the SDIs are massive users and issuers of financial derivatives.  The largest SDIs love financial derivatives.  Merrill Lynch failed because it was the largest purchaser of its own “green slime” derivatives, particularly collateralized debt obligations (CDOs) “backed” largely by endemically fraudulent liar’s loans.  Such purchases were guaranteed to swiftly make Merrill’s investment officers wealthy and destroy the firm.  My most recent columns have quoted Dimon’s dictum about accounting control fraud:

“Low-quality revenue is easy to produce, particularly in financial services.  Poorly underwritten loans represent income today and losses tomorrow.”

Freddie Mac, PNC Continue With Foreclosure Despite Error, Protests

Chicago’s Albany Park Autonomous Center says PNC Bank has acknowledged that they initiated foreclosure against a Minneapolis family in error, but the move is continuing despite pleas from the family and supporters. After months of waiting and multiple eviction attempts, the Cruz family is traveling to the bank’s headquarters in Pittsburgh, along with a caravan of supporters.

Alejandra and David Cruz, two Minneapolis college students and Dream Act activists, along with their Mexican immigrant parents, stopped Wednesday in Chicago to visit the regional headquarters of secondary market lender Freddie Mac, which currently holds the title to their home.

“My parents had to work so hard for this house,” Alejandra Cruz told an Occupy Homes rally in May, according to the Uptake. “It’s unjust for the banks to take away our dream. My parents brought us here really young, and we’ve learned how to fight against injustice ever since we came to this country. It’s been a struggle for us every single day since we got here.”

Occupy Chicago Fights For Publication Referencing Tribune

Occupy Chicago is fighting an effort by the Chicago Tribune to hand over the Web domain names for its publication that references the newspaper.

As Michael Miner reported last week in the Chicago Reader, the Tribune filed a complaint with the World Intellectual Property Organization – a Geneva, Switzerland-based United Nations agency – after Occupy Chicago began publishing the “Occupied Chicago Tribune,” a print and online news publication that bills itself as “media for the 99 percent” and says it is “proud to have no affiliation whatsoever with the 1 percent Chicago Tribune or the Tribune Co.”

Occupy Phoenix Protesters Exonerated

A group of Occupy Wall Street protesters who were arrested and accused of forcing cops to spend thousands of dollars on unnecessary overtime has been at least partially vindicated.

Of 47 protesters who were arrested during a 2011 Phoenix, Ariz., march, every person who fought back has had the charges dropped as of this month, according to David A. Black, a criminal defense lawyer who represented one of the defendants. Black’s review of Phoenix police spending also suggests that law enforcement officials may have overestimated the cost of keeping order during three days of protesting – or else considerably overpaid themselves.

Occupy Redwood City [CA] to Organize at Home of San Jose Vice Mayor

Members of the Occupy Movement from Redwood City and San Jose will join with homeless and labor advocates this evening to occupy the home of San Jose Vice Mayor Madison Nguyen.

Occupy Redwood City spokesman James Lee said that about a dozen occupiers and other like-minded advocates are organizing in front of Nguyen’s residence this evening in San Jose to protest her political views.

Lee claimed that Nguyen has recently attacked local labor unions by voting for pension reform, as well as taken action that removes police officers from the streets and not taken the city’s homelessness issue seriously.

Gill Tract Attorney Says UC Civil Lawsuit Dropped

In a statement released by email just before 12:30 p.m. Wednesday, attorney Michael Siegel announced that the civil lawsuit against activists allegedly involved in what UC Berkeley described as illegal activities at the Gill Tract earlier this year has been dropped.

Upbeat protesters dance through Portland’s living room

Upbeat protesters expressed their desire to “build a better world” during a flash mob in Pioneer Courthouse Square on Wednesday afternoon.

A group of community organizers, activists and artists organized the event as part of a spin-off of the Occupy Portland protests.

“We want to show people that we can build a better world together. We want to invite them to come share their visions of that world with us, and we want to do it in a way that is fun and shows that we don’t take ourselves too seriously,” said organizer Sam Smith. “A revolution without dancing isn’t worth having.”

Austerity in the UK – Spending cuts could ‘last 10 years’

Britain’s most senior civil servant has warned the country could face a decade of spending cuts. Cabinet Secretary Sir Jeremy Heywood said the Government was just 25% of the way through its austerity programme.

Speaking to civil servants at Westminster, Sir Jeremy reportedly warned that spending restraint could last “seven, eight, maybe ten years”.

Workers occupy art center in wage protest [Turkey]

The workers said that Borusan Logistics terminated their work contract because they joined the Nakliyat- Union. One of the placards the demonstrators carried said the company raised the workers’ wage by only 4 percent even though the company posted 20 percent growth in 2011 and was expecting similar figures in 2012.

A spokesperson for the demonstrators said they occupied the art space to highlight the fact that while the company was polishing its image with contributions to high-brow art with projects like a Philharmonic Orchestra, it was not paying its workers a sufficient wage. The group’s spokesperson said they talked with the company’s lawyers and settled the issue with an eye to scheduled negotiations on their problems tomorrow.

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