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Posts Tagged ‘bailout’

Today’s Flickr photo

Scroll with signatures collected by the Monahan brothers who walked across the country to protest the Citizens United ruling. Flickr photo by M.V. Jantzen

If you read one thing today . . .

It’s pretty clear that Tea Party matriarch Sarah Palin  is no lover of Big Government or big bailouts. Except, she was for the bailouts before she was against them. David Corn in Mother Jones has an interesting look at the old Sarah’s defense of bailouts and the new Sarah’s displeasure.

Palin went further this summer, when she contended that Alaska Sen. Lisa Murkowski’s support for the bailout was grounds for voting against her. Palin was backing Joe Miller in the GOP primary against Murkowski. In an endorsement message for Miller posted on her Facebook page in August, Palin, bashing Murkowski as a faux Republican, declared,

Alaska deserves a senator who will not talk one way in the Last Frontier and then vote the opposite way in the Beltway. It’s time for Alaskans who are concerned about endless bailouts, ever increasing debt and deficits, and the government take-over of health care (all planks Lisa Murkowski has walked) to get behind Joe Miller.

Palin added, “We know Joe won’t support more bailouts, but we know Lisa already has.”

In less than two years, Palin had gone from endorsing the bailout to using it as ammo to slam a fellow Republican who had also supported TARP.

Overheard

That nervous rattling you hear is coming from the U.S. Capitol where those up for election in 2012 who must feel like they have targets painted on their chest after watching so many incumbents and party favorites bite the dust during the midterm primaries and general election. Call it the Tea Party effect. Politico’s Manu Raju writes that several veteran Republicans and Democrats are worried. Missouri Democrat Claire McCaskill, who faces the prospect of running in a solid red state, is stressing her independence:

“I don’t think you have to be disloyal to President [Barack] Obama, to be independent,” said McCaskill, who is facing reelection in a state that Obama lost in 2008. “And I think that’s the message that I got to make sure that Missourians understand: that I haven’t been afraid to differ from Harry Reid; I have not been afraid to take on Nancy Pelosi; I have not been afraid to tell the president he is wrong. And that I have been the independent that I think most Missourians want.”

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On Alternet, filmmaker Michael Moore figures if General Motors is posting profits, layoffs can’t be far off. But seriously, why isn’t GM and the rest of corporate America hiring? When will Main Street start seeing the windfall from the government bailout of Wall Street?

The government stepped in with trillions of dollars in cash and guarantees to keep Corporate America from collapsing due to its own stupidity, short-sightedness and greed. And it worked—for Corporate America. You may not have noticed as you were being foreclosed on, but the profitability of the Fortune 500 is almost back to normal

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The Senate resumes debate today on the Wall Street reform bill, having late last Thursday rejected probably the most important measure proposed to reduce Wall Street power, strengthen financial stability and fortify our democracy: breaking up the banks.

By a 33-61 vote, the Senate defeated the Brown-Kaufman amendment, which would have forced the largest banks to get smaller. Three Republicans, including Richard Shelby, the ranking member of the Banking Committee, joined 30 Democrats in supporting the measure.

This was a very big deal loss. But things aren’t over by any means. (more…)

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Last week, Public Citizen and several of its coalition partners held a news conference  in support of a tax on financial speculation. The tax is a very small levy on financial short-term transactions, which will curb excessive speculation by big banks, but with a minimal impact on long-term investors. The tax could raise more than $100 billion year for the U.S. Treasury. You can see the entire news conference in the videos above and below. Or you can visit our YouTube page to see clips of the individual speakers.  (more…)

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Weissman

When it comes to Wall Street, “reform” is not the issue.

We know this, because everyone supports reform.

“We believe that sensible and significant reforms that do not impair entrepreneurship or innovation, but make markets more efficient and safer, are in everyone’s best interest,” write Goldman Sachs CEO Lloyd Blankfein and company President Gary Cohn.

“We at JPMorgan Chase and at other banks have consistently acknowledged the need for proper regulatory reform,” echoes Jamie Dimon, CEO of J.P. Morgan.

Says Ryan McKee, senior director of the Chamber of Commerce‘s Center for Capital Markets Competitiveness: “We need strong consumer protections, the elimination of duplicative regulation, and strong enforcement against illegal financial activities.”

And Republican strategist Frank Luntz advises clients, “You must acknowledge the need for reform that ensures this NEVER happens again.”

What matters is not the fact of reform itself, but the content of reform. As the Senate takes up debate over new financial regulatory rules, Wall Street and the big banks are mobilizing to confuse the public and leverage their power on Capitol Hill. Their objectives: Confine the debate to technical issues and traditional regulatory questions. Prevent (more…)

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Last Friday, David Arkush, director of Public Citizen’s Congress Watch division, went on CNBC to take on the corporate lobby’s spin about the effects of a tax on Wall Street’s speculative activities.

The European Union is moving forward with measures to curb the kind of risky, reckless financial speculation that led to the worst financial crisis since the Great Depression. Much to the dismay of Wall Street fat cats eager to maintain an unsustainable status quo, similar measures have also been proposed in the U.S.

Not surprisingly, the U.S. Chamber of Commerce wants to scare the public away from measures restoring any kind of accountability to the big banks and financial speculators.   (more…)

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Recently, a financial industry lobbyist said because Sen. Christopher Dodd (D-Conn.) is retiring, he is now free to “dance with the special interests that brought him to the dance in the first place. Us, his loyal donors in the banking community.”

Nearly 46,000 concerned Americans joined Public Citizen and our partners in saying, “No way!” Dodd is now free to do the right thing and hold the banksters accountable.

Americans for Financial Reform, Credo, Consumer Watchdog and the Center for Media and Democracy helped collect signatures. Together, we urged Dodd to keep up the fight for significant financial reform to rein in Wall Street and prevent another economic crisis. In particular, we called on Dodd to ensure there is a strong and independent Consumer Financial Protection Agency.

(more…)

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Weissman

They’re back at the trough. The folks at AIG don’t get it. Do they expect to be congratulated for taking $100 million in bonus payments instead of $110 million or $120 million? Payment of the bonuses is justified as contractually required but the government-owned AIG can honor such contractual terms only because the firm was rescued with $180 billion in taxpayer supports.

This latest outrage comes on top of reports that emerged in recent months that AIG employees en masse reneged on promises made last year to return bonus payments.

The refrain that bonus payments must be made to retain “talent” doesn’t even qualify as a cruel joke. This is the so-called talent that presided over the collapse of AIG and cost taxpayers countless billions.

Congress is not helpless on this issue, and has no excuse for failing to take action. When the AIG bonus scandal broke, there was serious talk of imposing a 90 percent tax on the bonus payments. Once fooled, it is time for Congress to return to this remedy.

AIG, of course, is only the most egregious example of bonus abuse. It is time for Congress to adopt an across-the-board windfall bonus tax on Wall Street and the financial sector. The place to start is by taking up the Responsible Banking Act, introduced by Rep. Dennis Kucinich (D-Ohio).

Robert Weissman is president of Public Citizen.

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The bank fee announced today by the Obama administration is a very welcome first step in recouping the costs of the financial crash from its perpetrators. Wall Street’s till is overflowing – with cash that has come directly and indirectly from taxpayers. Ongoing taxpayer support extends far beyond the Troubled Asset Relief Program (TARP) and totals in the trillions.

Today’s action should only be a first step. It should be accompanied in the coming year by a speculation tax on financial transactions and a windfall tax on Wall Street bonuses and profits.

Additionally, Wall Street’s rapid return to profitability has been fueled by a return to the same risky practices that created the financial crash. Without meaningful restraints imposed on Wall Street – going beyond what the U.S. House of Representatives has so far adopted, including breaking up the too-big-to-fail financial institutions, among other measures – there is every likelihood of another financial meltdown.

Robert Weissman is president of Public Citizen.

Flickr photo by SEIU International.

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Weissman

Wall Street is giving outrageous a bad name.

We are just 16 months past the Wall Street crash of 2008. Forget profitability – Wall Street firms exist only because they have benefited from trillions of dollars in public supports. These supports extend far beyond the $700 billion for the Troubled Assets Relief Program, commonly referred to as the bank bailout, and are ongoing. The billions that Wall Street is now preparing to pay itself in unconscionable bonuses come, in a very real sense, out of the pockets of We, The People.

The rationale for rescuing the financial sector from itself was never to enable Wall Street executives and traders to pull down eight-figure bonuses. These bonuses do not reflect a return to prudent lending to the real economy, but a return to the worst speculative excesses of the past. We, The People – and our government – do not need to sit idly and watch this Wall Street pillage. Now is the time for the Congress, with White House support, to impose a bonus tax on Wall Street. Public Citizen for months has urged adoption of a Wall Street bonus tax. The United Kingdom has now adopted such a measure, and the idea is quickly gaining support in the United States. Its our money that Wall Street is trying to siphon from the system; our government needs to take it back.

A bonus tax is only the first step in reforming Wall Street pay abuses, and pay reform is only one component of needed financial regulatory reform. Wall Streets readiness to pay itself outlandish bonuses underscores the need for very aggressive reform measures. This industry, above all, is one that cannot regulate or restrain itself. Left to its own devices – as it was throughout the previous decade – it will return to exactly the same destructive practices that have drained the public treasury, led to millions of foreclosures and thrown the economy into a tailspin.

Robert Weissman is president of Public Citizen.

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