Saturday, October 17, 2009

Go To "Showdown in Chicago - Oct. 25" to Change the World!

Dean Baker*, Co-Director of the Center for Economic and Policy Research, says if we go to Chicago (again!), we can change the future (both economic and political) of this country.

And Take America Back From the Banks! (Emphasis marks added - Ed.)

(Breaking News: Goldman Sachs 2009 bonuses to double 2008’s!)

Reining in the financial industry's power and greed will be a long, hard-fought war. But it is one that must be fought

The elites hate to acknowledge it, but when large numbers of ordinary people are moved to action, it changes the narrow political world where the elites call the shots. Inside accounts reveal the extent to which Lyndon Johnson and Richard Nixon's conduct of the Vietnam war was constrained by the huge anti-war movement. It was the civil rights movement, not compelling arguments, that convinced members of the US Congress to end legal racial discrimination. More recently, the town hall meetings dominated by people opposed to healthcare reform have been a serious roadblock for those pushing reform.

Those disgusted by the bank bailouts, and the bankers who brought us this recession, will have a chance to make their views known when the American Bankers Association has its annual meeting in Chicago this month. A large coalition of labour, community and consumer organisations are organising a protest at this "Showdown in Chicago".

A big turnout at this event can make a real difference. Just to review the scorecard, most of the country is still suffering the fallout from the bankers' irrational exuberance of the housing bubble era. The Congressional Budget Office (CBO) and other forecasters expect the suffering to endure for years to come.

The US unemployment rate is about to cross 10%, with an additional 9 million workers only able to find part-time work. CBO projects that unemployment will not return to normal levels until 2014. Almost 200,000 people are losing their homes every month through foreclosure. Tens of millions of people who had expected a comfortable retirement just saw most of their wealth disappear with the collapse of the housing bubble. State and local governments are being forced to lay off school teachers and fire fighters under the pressure of enormous budget deficits.

But not everyone is suffering. Thanks to the bailout programmes put in place last fall, most of the country's major banks are back on their feet. In fact, in the most recent quarter, bank profits hit a new record high as a share of all corporate profits.

And the banks are sharing their wealth. Many of their top executives and high performers will be getting bonuses this year worth millions of dollars. In some cases the bonuses will be in the tens of millions.

In the meantime, in elite Washington circles people are busy making plans for a national sales tax so that the government can limit the fiscal damage caused by the bankers' recession. A sales tax is of course very regressive, since low- and moderate-income people typically spend the vast majority of their income, while our banker friends will more likely to be able to save some of their income or spend it in other countries where they will not be paying this new sales tax.

To summarise: the bankers wrecked the economy with their greed, ran off with taxpayer dollars in a massive bailout and now plan to raise taxes for the rest of us. If that picture doesn't sound quite right, then go to Chicago.

This is a case where the divisions are not left-right, but of the elite against everyone else. When Congress was debating the Tarp bank bailout last fall, members of Congress were hearing calls from people across the political spectrum who were outraged that their tax dollars were going to the banks that had wrecked the economy. A higher percentage of Republicans than Democrats ended up voting against this bankers' piñata.

The policies that will rein in the banks: reform of the Federal Reserve Board to make it democratically accountable, a tax on financial speculation to pay for the bankers' mess and restrictions on the bank abuses of consumers that caused the carnage have support from people on both the left and right.

A bill that would require the Fed to disclose what it did with more than $2tn in loans to banks and other financial institutions was originally co-sponsored by Ron Paul and Alan Grayson, one of the most conservative and one of the most progressive members of Congress. Due to public pressure, it now has more than 270 co-sponsors.This is exactly the sort of alliance that gets the elite worried. Reining in the power of the financial industry will be a long, hard-fought war, but it is one that must be fought. President and Nobel peace prize winner Barack Obama may not have been able to bring the Olympics to Chicago, but everyone who wants to retake our country from the banks can bring their backside there on 25 October.

* Dean Baker is co-director of the Center for Economic and Policy Research in Washington, DC. He is frequently cited in economics reporting in major media outlets, including the New York Times, Washington Post, CNN, CNBC, and National Public Radio. He writes a weekly column for the Guardian Unlimited (UK), and his blog, Beat the Press, features commentary on economic reporting. His analyses have appeared in many major publications, including the Atlantic Monthly, the Washington Post, the London Financial Times, and the New York Daily News.

He received his Ph.D in economics from the University of Michigan.Dean has written several books, his latest being Plunder and Blunder: The Rise and Fall of the Bubble Economy (PoliPoint Press, 2009), which chronicles the growth and collapse of the stock and housing bubbles and explains how policy blunders and greed led to the catastrophic - but completely predictable - market meltdowns. This year he also wrote a chapter ("From Financial Crisis to Opportunity") in Thinking Big: Progressive Ideas for a New Era (Progressive Ideas Network, 2009). His previous books include The United States Since 1980 (Cambridge University Press, 2007); The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer (Center for Economic and Policy Research, 2006), and Social Security: The Phony Crisis (with Mark Weisbrot, University of Chicago Press, 1999). His book Getting Prices Right: The Debate Over the Consumer Price Index (editor, M.E. Sharpe, 1997) was a winner of a Choice Book Award as one of the outstanding academic books of the year.

On to Chicago! Suzan _________________


Distributorcap said...

i am assuming graham nash is in full agreement:

Chicago, Graham Nash

So your brother's bound and gagged
And they've chained him to a chair
Won't you please come to Chicago just to sing
In a land that's known as Freedom
How can such a thing be fair
Won't you please come to Chicago for the help that we can bring

we can change the world
rearange the world

Suzan said...

Yes, of course.

Thanks for the comment, Dc!

And I would have run the tune if I'd had more time!

The truth of the lyrics will be on full display thereafter (see prison construction by Halliburton for home-grown terrorists).

And they have changed the world.


One Fly said...

Suzan-OTC thanks you for the link and has happily returned the favor!!
One Fly

Suzan said...

You are very welcome!


Beach Bum said...

Tens of millions of people who had expected a comfortable retirement just saw most of their wealth disappear with the collapse of the housing bubble.

Saw that first hand when a coworker of mind saw his 401k evaporate with him about two years away from retiring.

CBO projects that unemployment will not return to normal levels until 2014.

I have been a huge supporter of the president, even with his turtle-like slowness on various reforms, but this is one problem he has to get out in front of and go Bush-like on Congress beating them aside the head or just tricking them into action. If unemployment is any where near the levels now in 2012 he will be unemployed after the election.

Suzan said...


And the presidential ticket of BaughBeck will have assumed their proper intellectual plateau?


Gotta say that I have carefully followed every move his Oh-ness made after his world-shattering election and didn't receive one positive vibe on the economic/financial front.

Yes. The social moves are good, but they will be reversed by the new guy in 2012, so that's not enough.

For me anyway.


If unemployment is anywhere near the levels now in 2012 he will be unemployed after the election.