Bail Out the People, Not the Banks!

Bail Out the People Movement | Donate | Jan 17 Fightback Conference

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Support Steve Millies
Defend the Right to Demand “Bail Out the People, Not the Banks!”

Wall Street & MTA: “This Shoe is for You!”

Yesterday, activists from the Bail Out the People Movement attended the MTA board meeting to protest proposed draconian budget cuts and fare hikes.  The increase in subway & bus fares, layoffs, and service cuts are all going to fatten the coffers of Wall Street Bankers – the same bankers who have received hundreds of billions of dollars in bailout money.

Steve Millies, a long time activist, took the podium at the meeting and denounced the MTA as “a collection agency for the biggest banks and insurance companies,” and said that the budget should be “thrown in the garbage can.”

Today’s New York Times reports:

“We don’t need any fare increases and we don’t need our transit system ravaged either,” said Mr. Millies, who said he was an Amtrak signal-tower operator and a member of the Bail Out the People Campaign, a group that has stood up for victims of the economic crisis. He called for the subway and bus fare to be reduced to $1, to help unemployed New Yorkers.

Then, referring to the authority’s chief executive, who was sitting about 15 feet away, he said: “Where is Elliot Sander?” He stooped, slipped off one of his shoes and shouted, “You made $300,000 last year.”

Immediately, authority police officers swarmed him and pushed him out of the room. He was clutching his shoe, a black, thick-soled oxford, in his hand….

“I wanted to show the sole of the shoe as a sign of contempt for someone who makes so much money and yet wants to raise fares on the disabled,” he said. He said that the authority’s plans to more than double the $2 fare for disabled passengers who use the Access-a-Ride service particularly incensed him.

He said the gesture was planned with Muntader al-Zaidi, the Iraqi shoe-thrower, in mind.

“I was very much inspired by that courageous Iraqi journalist who was protesting the occupation of his country by the American and British oil companies and their governments,” Mr. Millies said.

Mr. Millies said the ticket he was given charged him with “intent to cause a public annoyance.”

“What’s the point of having a public hearing,” he said, “unless you allow people to annoy public officials?”

Activists all around the city and country are applauding Steve Millies. He did what millions of New Yorkers, who are paying more for everything while bankers are being bailed out, would love to do.

Millies reported for work yesterday at AMTRAK, where he has been a union worker for 24 years, and was told by his supervisors to go home because of this incident.

Action Alert:

Here’s how you can help:

• Please call the NYPD Switchboard at 1-646-610-5000 – demand that the false charges against Steve Millies be dropped.
• Make a donation online at http://bailoutpeople.org/donate.shtml.  Help us defend Steve Millies and continue to organize to demand “Bail Out the People Not the Banks!”

Steve Millies will be one of the many activists and community organizers attending the important January 17 Fightback Conference, held on the weekend of the 80th Anniversary of Martin Luther King, Jr.’s 80th birthday. This important conference will include skill sharing, workshops, and planning for direct action and peoples’ intervention against fare hikes, tuition and utility increases, evictions and foreclosures, as we continue to mobilize to demand “Bail Out the People – Not the Banks!”  For information on the conference, go to www.BailOutPeople.org.

MEDIA COVERAGE***

Youtube – Ch 11
http://www.youtube.com/watch?v=BjAslDC3BbU

Say Whatever You Want, but No Throwing Shoes (New York Times):
http://www.nytimes.com/2008/12/18/nyregion/18sander.html

The shoe must go on: MTA adopts ‘miserable’ budget
http://www.newsday.com/news/local/transportation/ny-limta185969267dec18,0,1516669.story

Touching your shoes during conference can land you in jail!
http://www.thaindian.com/newsportal/world-news/touching-your-shoes-during-conference-can-land-you-in-jail_100132527.html

This Shoe’s For You: Emotions Boil At MTA Hearing:
http://wcbstv.com/cbs2crew/mta.cash.crunch.2.889271.html

At M.T.A. Hearing, Another Shoe Almost Dropped:
http://cityroom.blogs.nytimes.com/2008/12/17/at-mta-hearing-another-shoe-almost-dropped/

Rider to MTA boss: ‘This shoe is for you!”:
http://www.newsday.com/iphone/ny-nymta1218,0,5427568.story

This Shoe’s for you, MTA! Protester at board meeting inspired by Iraqi who threw shoes at Bush:
http://www.nydailynews.com/ny_local/2008/12/17/2008-12-17_this_shoes_for_you_mta_protestor_at_boar-1.html

MTA Board Approves Fare Hike, Service Cuts:
http://www.ny1.com/content/top_stories/90797/mta-board-approves-fare-hike–service-cuts/Default.aspx

Disgruntled Subway Rider Attempts to Throw Shoe at MTA Boss:
http://www.wpix.com/landing/?Disgruntled-Subway-Rider-Attempts-to-Thr=1&blockID=164538&feedID=1404

Bail Out The People Movement
55 W. 17th St., 5C, New York, NY 10111
212-633-6646
www.BAILOUTPEOPLE.org

Elementary Wedgwood, it’s the exponential growth economy!

submitted by a reader

Red Alert: What went wrong in the capitalist casino

Stating the obvious, Tony Benn argues the banking disaster is the result of too much economic power being exercised by too few individuals. He prefers the socialist version of the exponential growth economy.

In his capacity as a prominnet member of the establishment [it would be too unkind and unnecessary to call him a “gatekeeper,”] he neither criticizes nor highlights root cause of the banking problems, the exponential growth economy. He never mentions the need for a ‘radical’ change to the system of political economy that is driving humanity and most other species toward oblivion.

The following excerpts are from Benn’s article Red Alert: What went wrong in the capitalist casino, which first appeared in the Tribune Magazine:

“THE great inter-war slumps were not acts of God or of blind forces. They were the sure and certain result of the concentration of too much economic power in the hands of too few men. These men had only learned how to act in the interest of their own bureaucratically-run private monopolies which may be likened to totalitarian oligarchies within our democratic state, They had and they felt no responsibility to the nation.”

These words are from the 1945 Labor manifesto Let Us Face The Future which brilliantly identified the very same crisis which is now described as a “credit crunch” as if it were a mere hiccup in an otherwise wonderful neo-liberal globalized world which could be corrected with a vast subsidy from the taxpayers to put the Wall Street casino and its partners worldwide back into profit. It reminded me of the fact that when slavery was abolished it was the slave owners, and not the slaves, who received compensation from the government of the day.  Read more …

Related Links:

• 10 Biggest Threats to the US National Security

• 13 things you should know!
• [Surprise, Surprise!] The Public Has NO faith in U.S. Institutions
• The Billionaires’ contribution to CO2 pollution

Rolling the Dice on Derivatives

Moderators hope that Mr Nader is NOT attempting to promote Mr Buffet’s type of capitalism as one preferable to ‘casino capitalism’ because the two types are one of the same. TERRES

In the Public Interest

by Ralph Nader

The derivatives markets of today have become a high stakes casino of unimaginable magnitude. Wall Street’s bets have gone bad, and now the whole financial system is in peril. In a best-case scenario, it appears, the taxpayers will be required to rescue the system from itself. This is why Warren Buffet labeled derivatives “weapons of financial mass destruction.”

Amazingly, there seems to be some lingering sense that current-day derivatives properly perform an insurance function.

Case in point: Alan Greenspan, the former Federal Reserve Chairman. Greenspan says the world is facing “the type of wrenching financial crisis that comes along only once in a century,” but, reports the New York Times, “his faith in derivatives remains unshaken.” Greenspan believes that the problem is not with derivatives, but that the people using them got greedy, according to the Times.

This is quite a view. Is it a surprise to Alan Greenspan that the people on Wall Street — said to be ruled only by the opposing instincts of greed and fear — “got greedy?”

This might be taken as just a bizarre comment, except that, of course, Alan Greenspan had some considerable influence in driving us to the current financial meltdown through his opposition to regulation of derivatives.

A series of deregulatory moves, blessed by Alan Greenspan, helped immunize Wall Street derivatives traders from proper oversight.

In 1995, Congress enacted the Private Securities Litigation Reform Act (PSLRA) of 1995, which imposed onerous restrictions on plaintiffs suing wrongdoers in the stock market. The law was enacted in the wake of Orange County, California’s government bankruptcy caused by abuses in derivatives trading. An amendment offered by Rep. Ed Markey would have exempted derivatives trading abuse lawsuits from the PSLRA restrictions. In defeating the amendment, then-Representative and now-SEC Chairman Chris Cox quoted Alan Greenspan, saying “it would be a grave error to demonize derivatives;” and, “It would be a serious mistake to respond to these developments [in Orange County, California] by singling out derivative instruments for special regulatory treatment.”

The New York Times reports how the Commodity Futures Trading Commission aimed for some modest regulatory authority over derivatives in the late 1990s. Strident opposition from Treasury Secretary Robert Rubin and Alan Greenspan spelled doom for that effort.

Senator Phil Gramm helped drive the process along with the Commodities Futures Modernization Act of 2000, which deregulated the derivatives market.

Defenders of deregulation argued that sophisticated players were involved in the derivatives markets, and they could handle themselves.

It’s now apparent that not only could these sophisticated players not handle themselves, but that their reckless gambling has placed the entire world’s financial system at risk.

It seems to be then a remarkably modest proposal for derivatives to be brought under regulatory control.

Warren Buffet cut to the heart of the problem in 2003: “Another problem about derivatives is that they can exacerbate trouble that a corporation has run into for completely unrelated reasons,” he wrote in his annual letter to shareholders. “This pile-on effect occurs because many derivatives contracts require that a company suffering a credit downgrade immediately supply collateral to counterparties. Imagine, then, that a company is downgraded because of general adversity and that its derivatives instantly kick in with their requirement, imposing an unexpected and enormous demand for cash collateral on the company. The need to meet this demand can then throw the company into a liquidity crisis that may, in some cases, trigger still more downgrades. It all becomes a spiral that can lead to a corporate meltdown.”

That is to say, our current problems were foreseeable, and foreseen. There is no excuse for those who suggest that present circumstances –what many are calling a once-in-a-hundred-years event — were unimaginable during earlier debates about regulation.

Some ideologues continue to defend derivatives from very strict government control. As Congress moves to adopt new financial regulations next year, hopefully the proponents of casino capitalism will be given no more credence than those insisting that the sun revolves around the earth. [End.]

It would be interesting to see Alan Greenspan nominated for the 2009 Nobel Prize for economics!

Related Links:

• Ouch, there goes the 2008 Nobel prize for economics

TRS

Black Holes Suck!

One Day Soon, A Tiny Wall Street Black Hole Will Suck In the Rest of Your Assets! —TERRES

Casinos on Wall Street

by Ralph Nader
June 10, 2008

Move over Las Vegas. The big time gamblers are on Wall Street and they are gambling with your money, your pensions, and your livelihoods.

Unlike Las Vegas casinos, these big investment banks, commercial banks and stock brokerage houses are supposed to have a fiduciary relationship with your money. They are supposed to be trustees for the money you have given them to safeguard, and tell you when they are making risky investments.

Because Washington, D.C. has increasingly become corporate-occupied territory, the Wall Street Boys have been taking even greater risks with your money. The more they produce cycles of financial failure, the more they pay themselves through their rubberstamp boards of directors.

With each cycle of failure, the burden of government bailouts grows larger, meaning debt, deficit and your tax dollars. The Savings and Loan collapse in the late Eighties—costing before the bailout instruments are paid off at least $500 billion, looks small by comparison with what is going on today.

Why is it that these financial bosses never learn? Because they never pay for their gambling. They may be let go, as happened recently to the CEOs of Merril Lynch and Citigroup, but they ride away from their managerial wreckage loaded with compensation and severance gold. Some of it is clearly hush money from those buddies they left behind.

Now comes the latest installment of disastrous management that has been running the venerable Wall Street investment bank, Lehman Brothers. With its stock plummeting because of avaricious risktaking with other people’s money, mixed up with their huge pay packages, Lehman Brothers’ employees look to their leader, Richard S. Fuld. For some time, he and his fellow executives would exude confidence about their ability to manage their risking financial instruments compared to their tanking competitors.

This week, the Lehman Emperor really had no clothes. Mr. Fuld reported a staggering $2.8 billion loss in the second quarter, exceeding the most dire forecasts. Even the hedges that Lehman used to temper the losses from its mortgage investments soured, adding to the losses.

It was just last April that Mr. Fuld announced his belief that “the worst is over” in the markets. For this type of management, he got paid $40 million last year, or nearly a million dollars a week, not counting vacations.

The Wall Street Boys, like all charlatans, develop words and phrases to dress up their megagambling practices. They say they are trying to avoid a “crisis of confidence” when these proclaimed capitalists go to Uncle Sam for a socialistic bailout. That only increases the “moral hazard”—another euphemism—and sets the stage for another round of reckless Wall Street Goliaths being deemed “too big to fail”.

One of Wall Street’s sharpest analysts—Henry Kaufman—believes that the “too big to fail” phenomenon undermines market discipline and encourages the smaller firms to merge with the larger companies to avail themselves of Washington’s bailout criteria.

Writing in the Wall Street Journal last August, Mr. Kaufman acutely traces the growth of ever more complex, abstract financial instruments, removed from their empirical underpinnings in the economy, accelerated by the lightening speed of computerized transactions. He called for “increased supervision over financial institutions and markets.”

“Supervision” was once called federal regulation. Call it what you will, Mr. Kaufman is not expecting anything soon. He writes: “In today’s markets, there is hardly a clarion call for such measures. On the contrary, the markets oppose it, and politicians voice little if any support. For their part, central bankers [read, the Federal Reserve] do not posses a clear vision of how to proceed toward more effective financial supervision.”

Though couched in polite, non-normative language, this is a very troublesome indictment of corporate intransigence and regulatory paralysis. Since August 2007, the situation has gotten worse with the Wall Street Boys producing more huge losses and phony asset valuations.

A few weeks ago, former Federal Reserve Chairman, Paul Volcker, delivered an address in New York voicing similar worries and calls for “supervision,” as did Mr. Kaufman, though in his own inimitable style.

Other astute, former men of Wall Street, have raised alarms about the stock and derivatives marketplace, including former SEC chairman, Arthur Levitt and William Donaldson. Long before anyone came cautionary wisdom of John Bogle, who pioneered stock market indexing and launched Vanguard Fund. (See his new book, The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns)

Still, there is no regulatory action in Washington which doesn’t even move on behalf of consumers to regulate the New York Mercantile Exchange where rampant speculation, not supply and demand, decides what you are paying for gasoline and heating oil.

With the politicians sleepwalking in Washington, while their campaign pockets are filled by Wall Street cash, isn’t it time for the people of America to rouse themselves civically and politically? Act before the financial sector, using your money, shreds itself under the weight of its own top-heavy greed and cliff-hanging mismanagement.

For starters, start demanding more from your politicians, much more!

Stop the Oil Speculators

by Ralph Nader
5/27/08

What factors are causing the zooming price of crude oil, gasoline and heating products? What is going to be done about it?

Don’t rely on the White House—with Bush and Cheney marinated in oil—or the Congress—which has hearings that grill oil executives who know that nothing is going to happen on Capitol Hill either.

Last week the price of crude oil reached about $130 a barrel after spiking to $140 briefly. The immediate cause? Guesses by oil man T. Boone Pickens and Goldman Sachs that the price could go to $150 and $200 a barrel respectivly in the near future. They were referring to what can be called the hoopla pricing party on the New York Mercantile Exchange. (NYMEX)

Meanwhile, consumers, workers and small businesses are suffering with the price of gasoline at $4 a gallon and diesel at $4.50 a gallon. Suffering but not protesting, except for a few demonstrations by independent truckers.

A consumer and small business revolt could be politically powerful. But what would they revolt to achieve? Their government is paralyzed and is unable to indicate any action if oil goes up to $200 or $400 a barrel. Washington, D.C. is leaving people defenseless and drawing no marker for when it will take action.

Oil was at $50 a barrel in January 2007, then $75 a barrel in August 2007. Now at $130 or so a barrel, it is clear that oil pricing is speculative activity, having very little to do with physical supply and demand. An essential product—petroleum—is set by speculators operating on rumor, greed, and fear of wild predictions.

Over the time since early 2007, U.S. demand for petroleum has fallen by 1 percent and world demand has risen by 1.3 percent. Supplies of crude are so plentiful, according to the Wall Street Journal, “traders of physical crude oil say their market is suffering from too much supply, not too little.”

Iran, for instance, is storing 25 million barrels of heavy, sour crude oil because, in the words of Hossein Kazempour Ardebili, Iran’s oil governor, “there are simply no buyers because the market has more than enough oil.”

Mike Wittner, head of oil research at Societe Generale in London agrees. “There’s various signals out there saying for right now, the markets are well supplied with crude.”

Historically, oil has been afflicted with the control of monopolists. From the late nineteenth century days of John D. Rockefeller, and his Standard Oil monopoly, to the emergence of the “Seven Sisters” oligopoly, made up of Standard Oil, Shell, BP, Texaco, Mobil, Gulf and Socal, to the rise of OPEC representing the major producing countries, the “free market” price of oil has been a mirage. Despite the breakup of the Standard Oil company by the government’s trustbusters about 100 years ago, selling cartels and buying oligopolies kept reasserting themselves.

In an ironic twist, the major price determinant has moved from OPEC (having only 40% of the world production) and the oil companies to the speculators in the commodities markets. What goes on in the essentially unregulated New York Mercantile Exchange (NYMEX)—without Commodity Futures Trading Commission (CFTC) enforced margin requirements, and, unlike your personal purchases, untaxed—is now the place that leads to your skyrocketing gasoline bills. OPEC and the Big Oil companies reap the benefits and say that it’s not their doing, but that of the speculators. Gives new meaning to “passing the buck.”

Deborah Fineman, president of Mitchell Supreme Fuel Co. in Orange, New Jersey, summed up the scene: “Energy markets have been dictated for too long by hedge funds and speculators, who artificially manipulate the numbers for their own benefit. The current market isn’t based on the sound principles of supply and demand but it is being rigged by companies and speculators who are jacking up prices for their own greed.”

Harry C. Johnson, former banker who worked for many years inside Big Oil and ran his own small oil company in Oklahoma, blames the CFTC, the Department of Energy, the Administration, and Congress, as “asleep at the switch on an issue that is probably costing U.S. consumers $1 billion per day.”

He cites “some industry experts, who profit greatly from the high price of crude, and have stated openly that the worldwide economic price of crude, absent speculators, would be around $50 to $60 per barrel.

Imagine, our government is letting your price for gasoline and home heating oil be determined by a gambling casino on Wall Street called NYMEX. The people need regulatory protection from speculators and an excess profits tax on Big Oil.

In addition, a sane government would see the present price crises as an opportunity to expand our passenger and freight railroad capacity and technology.

A sane government would drop all subsidies and tax loopholes for Big Oil’s huge profits and other fossil fuels and promote a national mission to solarize our economy to achieve major savings from energy conservation technology, retrofitting buildings, and upgrading efficiency standards for motor vehicles, home appliances, industrial engines and electric generating plants.

Those are the permanent ways to achieve energy independence, reduce our trade deficit, create good jobs that can’t be exported and protect the environmental health of people and nature.

Those are the reforms and advances that a muscular consumer, worker and small business revolt can focus on in the coming weeks.

What say you, America?
[EoF]

Related links: Pinheads in the House: Fanning Oil Chaos

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