Real Banking Reform

The US Senate is looking to change laws governing financial and banking practices. This comes after passage last December of a banking “reform” bill in the House. President Obama says major changes are needed to prevent a repeat of the financial implosion of 2008.

The casino that is Wall Street, gambling with other people’s money on bizarre and complex investments backed up with next to nothing in real money, must end. The path of destruction from Wall Street’s recklessness — millions of people who lost homes, pensions, jobs; business foreclosures; and communities blighted – must never happen again.

The question is: are the proposed changes real reform or simply real good politics to placate voters who are angry at Wall Street and their political supporters in Congress?

The issues and proposals are highly detailed and confusing. I’m no expert in banking or financial laws. I haven’t read the Senate reform bill…or know for certain what offered amendments will make the final version.

These shortcomings aside, from readings and listening to a few talking heads on the Sunday morning programs, here are 10 points that you might want to consider when judging whether what comes out of Congress constitutes real reform or just real good politics.

1. I have not seen or heard in either the Senate of House version anything addressing criminal investigation or prosecution of anyone responsible for any part of the Wall Street induced economic implosion. The government obtained hundreds of felony convictions of those responsible for the collapse of Savings and Loans in the 1980’s. To date, not a single Wall Street CEO or executive has been charged with a criminal felony. No one is serving jail time – those who were responsible for causing millions of people to lose their homes, pensions and jobs. If you or I stole a loaf of bread from the corner store, we’d receive criminal punishment greater that what any Wall Street executives have received. That’s a crime. It should be noted that the recent charges against Goldman Sachs corporation are civil, not criminal.

2. Without knowing many of the details of the any of the bills, it’s hard to believe much substantively will change given President Obama’s attitude expressed last week on Wall Street. He said: “I believe in the power of the free market.” “I believe in a strong financial sector …” “We do not have to choose between markets that are unfettered by even modest protections against crisis, or markets that are stymied by onerous rules that suppress enterprise and innovation.” Note to the President: it was exactly and precisely the power of virtually free markets of Wall Street that caused the crisis. The lack of strong regulations allowed Wall Street to pursue greed. A strong financial sector does not equate to a strong economy. The strong financial sector (“financialization” of the economy) has come at the expense of a strong productive sector – producing actual products and services for the real economy rather that pushing money around from one place to another simply to make more money. Wonder if this attitude has anything to do with his campaign receiving $1 million alone from the Goldman Sachs political action committee in 2008 and $14 million more from the rest of the financial industry?

3. Neither the Senate or House bill seems to contain any provision that would rebuild the firewall between commercial and investment banking. This separation existed between 1933 to 1999 when the Glass-Steagall Act was in force – a law designed to control speculation. Financial entities were required to choose between safer commercial banking practices or riskier investment practices. Permitting banks to engage in both types of investments meant that investment banks that collapsed due to risky investments like credit default swaps or collateralized debt obligations would drag down their commercial banking side as well.

4. Speaking of which, the Senate bill doesn’t ban credit default swaps, collateralized debt obligations, and other exotic forms of speculation that played a major role in the financial crash and global recession.

5. Nor does the bill establish even the feeblest of measures that has riled the average American – capping excessive executive pay.

6. A lauded Consumer Financial Protection Bureau (to protect consumers against abusive, unfair and deceptive lending practices) is in both the Senate and House bills. There are many positive features. But there are several major shortcomings and differences between the two versions. One of the major differences is that the Bureau in the Senate version would have enforcement powers limited to only some banks and credit unions. Both versions maintain the ability of the federal government to preempt tougher state consumer protection laws. Historically, one of the ways corporations have escaped tough state controls is to push for weaker federal laws that supersede state laws.

7. The Federal Reserve will acquire new regulatory powers under the Senate bill. Only a few months ago it seemed the Fed (a quasi private agency) might lose much of its powers to oversee financial markets and agencies given its cheerleading of the financial free market policies leading up to the global financial crisis and subsequent Great Recession. Now, the Fed might well become the major regulator of many of the banking “reforms” affecting hundreds of financial corporations. So much for the Fed being “independent.” Oh, by the way, the Senate version has a much weaker provision to audit the Federal Reserve – a measure seeking to expose where exactly the tens of billions of taxpayer bailout money that went through the Fed ended up. The Fed has resisted being audited.

8. There are provisions to beef up regulations and transparency of derivatives, a major source of profits for the top Wall Street banks. Some claim the provisions are loaded with loopholes and exemptions. It’s estimated that there are more than $600 trillion (not billion but trillion) in these financial bets on bets. Hard to tell at this point how real these reforms are. Some have asserted the real solution is to outlaw these super-charged speculative “investments” altogether.

9. A provision to break up “too big to fail” banks is contained in the Senate bill. A much stronger amendment has been offered by US Senator Sherrod Brown (D-Oh) and Ted Kaufman (D-Del) that would prevent future bailouts according to its supporters. Overall, it seems to be a good bill. It’s unclear at this point whether it will receive sufficient support by the Senate to be added. President Obama has not yet stated his position either. A summary of the bill is at http://thehill.com/blogs/blog-briefing-room/news/93551-senators-will-file-too-big-to-fail-amendment

10. Underneath, above and surrounding all the above is political pressure – from both the financial industry that would love first and foremost a “reform” bill to its liking (and if not, then no bill at all) and the public that wants justice and fairness. The influence peddling and campaign contributions/investments by the financial industry is real. Financial corporations have spent $455 million to date to lobby Congress. The securities and investment industry has thus far invested $34 million for the 2010 election cycle. And counting. The public is angry – from progressive to tea baggers. It’s critical we know enough to be able to distinguish the difference between real and phony reform.

More important is to understand that even if “reforms” are passed exactly as we would hope and dream for, business as usual both economically and politically must end. Corporations cannot nor should not be in control of our politics and economics. We need real democracy – politically and economically. The economy as currently constituted is simply unsustainable. Other economic collapses are inevitable (“reforms” will only determine when and to what degree they will happen) given our money as debt-based economy and a system that has perfected making money by transforming natural resources into stuff into pollution and waste that is destroying economies and ecologies.

There are other ways that are well worth banking on.

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Expanding the Rights of Nature, Not Corporations

Today is the 40th Anniversary of Earth Day.

While the Supreme Court of the United States of America recently expanded the constitutional rights of corporations (artificial legal creations of the state), the 130-member Ecuador Constitutional Assembly, elected countrywide to rewrite the country’s Constitution, voted in July, 2008 to approve articles that recognize rights for nature and ecosystems. Two months later, the people of Ecuador voted by an overwhelming majority (64%) to approve the new constitution.

Ecuador, thus, became the first nation on planet earth to bestow upon nature inalienable rights imbedded in their constitution. Quite a contract to the 5 members of the US Supreme Court which expanded constitutional rights to corpses — pieces of property.

Ecuador Adopts New Constitution – With CELDF RIGHTS of NATURE Language
http://www.celdf.org/Default.aspx?tabid=548

Ecuador Constitution Grants Rights to Nature
By ANDREW C. REVKIN
http://dotearth.blogs.nytimes.com/2008/09/29/ecuador-constitution-grants-nature-rights/

The Community Environmental Legal Defense Fund has developed a model “Rights of Nature Ordinance” for consideration by local communities in this country.
http://www.celdf.org/Ordinances/NewRightsofNatureOrdinance/tabid/589/Default.aspx

As the world continues to be plundered in a seemingly never-ending cycle of transforming raw materials into stuff into waste (led by transnational corporations with greater plundering powers and rights), what is more life-affirming — expanding the constitutional rights of corpses or nature?

Move to Amend
http://www.movetoamend.org

Links to 4 Videos and 4 Articles on Corporate Personhood

These are all excellent resources…

Videos

Ben Manski & Lisa Graves at the March to Overrule the Court
February 17, 2010 — Ben Manski, executive director of Liberty Tree along with Lisa Graves, executive director of the Center for Media and Democracy, spoke to the March to Overrule the Court, at the Wisconsin State Capitol on Tuesday, February 16th. The demonstration was organized in coordination with MovetoAmend.org and the Wisconsin Democracy Campaign.
http://www.youtube.com/watch?v=V17c5phuvNk

Talk – David Cobb & Riki Ott – Organizing Community to Abolish Corporate Personhood
Talk by David Cobb with Democracy Unlimited of Humboldt County and Riki Ott, Executive Director of Ultimate Civics, on “Organizing Community to Abolish Corporate Personhood” given March 4, 2010 at Thomson Hall, University of Washington, Seattle, WA.
http://www.youtube.com/watch v=2tzWKjF3zQc&feature=PlayList&p=CAB46B18AA209A63&playnext_from=PL&index=0&playnext=1

Corporations Aren’t People – Video contest
See all 8 entries at (my favorites are #2 and #8)
http://www.wix.com/DavidAlliance/Corporations-Arent-People

CorpOrNation (an oldy but goody!)
The Story of Citizens and Corporations in Ohio
Produced by the Northeast Ohio American Friends Service Committee
http://www.youtube.com/watch?v=rgeEBV5wei0

Articles

Corporations Aren’t Persons
By Matthew Rothschild, April 2010 issue
http://www.progressive.org/mrapril10.html?keepThis=true&TB_iframe=true&height=650&width=850

Corporations are People Too
By Ben Manski and Lisa Graves
http://www.inthesetimes.com/article/5544/corporations_are_people_too/

On the Supreme Court
By Richard Grossman
April 15, 2010
http://www.commondreams.org/view/2010/04/15-8

Citizens United Ruling A Windfall For Consultants, TV Stations
Ryan Grim
http://www.huffingtonpost.com/2010/02/10/citizens-united-ruling-a_n_457076.html

Forum/Conference Call/Satire/Jurists on Corporate Personhood

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Forum
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Cliff Arnebeck, Chair, Common Cause, will examine both the legal and social
implications of the recent U.S. Supreme Court decision in “Citizens United v.
FEC” on Wednesday, April 21st, 7PM, at the Humanist Forum at the
First Unitarian Universalist Church of Columbus. This Supreme Court decision
extended the meaning of free political speech to corporate expenditures in
federal elections and thus granted broad First Amendment rights to corporations
under the corporate personhood doctrine.

The Fourteenth Amendment weighs heavily in the origins of corporate
personhood cases on which “Citizens United” depends, though the amendment’s
original purpose was to grant slaves the status of “person.” The presentation
will explore what the “Citizens United” decision means for social and racial justice,
the history of the Court and corporate rights within America.
Cliff Arnebeck successfully litigated against the Ohio Chamber of Commerce’s
claim of a free speech right to spend corporate money to influence Ohio Supreme
Court elections. He will lead a discussion of this revolutionary Supreme Court
case and where actual persons who are real citizens can go from here.

This forum is free and open to all.

First Unitarian Universalist Church of Columbus
93 West Weisheimer Road
Columbus, OH 43214-2544
For further information: (614) 267-4946 (church office)

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Conference Call
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Abolish Corporate Personhood Conference Call
Proposed dates: Tuesday, May 4 (8 PM) or Saturday, May 8 (10 AM)
PLEASE RESPOND TO gcoleridge@afsc.org WITH YOUR PREFERENCE
Proposed Agenda
Report on national Campaign to Legalize Democracy/Move to Amend gathering
Report on forums/educational events statewide
Name of statewide effort
Website
Local/statewide resolutions
July 4

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Satire
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Murray Hill Inc. | Murray Hill Incorporated is Running for Congress
http://murrayhillincforcongress.com:80/

SUPREME COURT: AS “PEOPLE,” CORPORATIONS CAN RUN FOR PRESIDENT

Halliburton said it is narrowing its choices for vice president.
http://www.legitgov.org/shulman_corps_can_be_president_010410.html

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Jurists on Corporate Personhood
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Here’s something I put together…

STATEMENTS BY SUPREME COURT JURISTS ON CORPORATE PERSONHOOD/CITIZENS UNITED VS FEC

“A corporation is an artificial being, invisible, intangible,” Chief Justice John Marshall wrote in an 1819 case. “It possesses only those properties which the charter of its creation confers upon it.”

Justice Hugo Black dissents in Connecticut General Life Ins. v. Johnson [1938] “I do not believe the word ‘person’ in the Fourteenth Amendment includes corporations.”

William Rehnquist dissents in 1979 from a decision voiding Massachusetts’s restriction of corporate political spending on referendums. Since corporations receive special legal and tax benefits, “it might reasonably be concluded that those properties, so beneficial in the economic sphere, pose special dangers in the political sphere,”

“Corporations have lots of knowledge about environment, transportation issues, and you are silencing them during the election,” Justice Anthony Kennedy

The majority decision of the Court in Citizens United vs FEC declared “…corporate expenditures cannot corrupt.” “Influence over lawmakers is not corruption…and appearance of influence will not undermine public faith in our democracy.”

Justice Sonia Sotomayor, “Judges created corporations as persons, gave birth to corporations as persons,” she said. “There could be an argument made that that was the court’s error to start with…[imbuing] a creature of state law with human characteristics.”

Justice Ruth Bader Ginsburg. “A corporation, after all, is not endowed by its creator with inalienable rights,” she said, evoking the Declaration of Independence.

John Paul Stevens in Citizens United dissent:
The conceit that corporations must be treated identically to natural persons in the political sphere is not only inaccurate but also inadequate to justify the Court’s disposition of this case.

In the context of election to public office, the distinction between corporate and human speakers is significant. Although they make enormous contributions to our society, corporations are not actually members of it. They cannot vote or run for office. Because they may be managed and controlled by nonresidents, their interests may conflict in fundamental respects with the interests of eligible voters. The financial resources, legal structure, and instrumental orientation of corporations raise legitimate concerns about their role in the electoral process. Our lawmakers have a compelling constitutional basis, if not also a democratic duty, to take measures designed to guard against the potentially deleterious effects of corporate spending in local and national races.

… corporations have no consciences, no beliefs, no feelings, no thoughts, no desires. Corporations help structure and facilitate the activities of human beings, to be sure, and their “personhood” often serves as a useful legal fiction. But they are not themselves members of “We the People” by whom and for whom our Constitution was established.

Retired Supreme Court Justice Sandra Day O’Connor, “Citizens United has signaled that the problem of campaign contributions in judicial elections might get considerably worse and quite soon.”

Radio Debate on Citizens United

Tune in… Listen in… Call in…

“All Sides with Ann Fisher”
Tuesday, April 6, 11:20 AM – noon EDT
WOSU, 820 AM Columbus

The topic to be discussed: In a controversial decision this year…“Citizens United v. Federal Election Commission”…the U.S. Supreme Court struck down long-standing federal restrictions on corporate spending in federal elections….We’ll hear two points of view on the issue of corporations as “persons” deserving constitutional rights…and the constitutional basis for the ruling, with Northeast Ohio American Friends Service Committee Director Greg Coleridge…and Capital University Law School Professor and former Federal Election Commission Chairman Bradley Smith.

“All Sides with Ann Fisher” is a live, public affairs talk show, with listener phone calls, on WOSU public radio. “All Sides” is streamed live, podcast and archived at http://www.wosu.org/allsides.

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School Law Clinics Face a Backlash
By IAN URBINA
Published: April 3, 2010
New York Times
ANNAPOLIS, Md. — Law school students nationwide are facing growing attacks in the courts and legislatures as legal clinics at the schools increasingly take on powerful interests that few other nonprofit groups have the resources to challenge.
More at http://www.nytimes.com/2010/04/04/us/04lawschool.html

Upcoming Events and Actions

4/8: Statewide Conference Call to Abolish Corporate Personhood
4/10: Corporate Personhood and Campaign Financing, Wooster
4/12: Citizens United v. FCC: Panel Discussion on Corporate Personhood, Columbus
4/17: Corporations and Democracy: The Citizens United Decision, Chagrin Falls

Statewide Conference Call to Abolish Corporate Personhood

Thursday, April 8, 8 PM – 9 PM
Call in #: 1-218-862-7200
Access Code: 744213

We’ll continue discussing and strategizing ways to respond to the Citizens United vs FEC Supreme Court decision.

Agenda items for call? Email gcoleridge@afsc.org

Corporate Personhood and Campaign Financing

A “Lunch and Learn” with Greg Coleridge of Akron Americans Friends Service Committee, who will facilitate this workshop. It will take place Saturday, April 10, 2010, from 10 a.m. to 3 p.m. at Unitarian Universalist Fellowship in Wooster.

Fine luncheon $12 per person
Includes ~ Carnivore – Vegetarian – Vegan Choices
Unitarian Universalist Fellowship 3186 Burbank Rd. Wooster OH.

SEATING LIMITED Call NOW to reserve your seat 330-749-5112

Flyer at http://www.wayneprogressives.org/pdfs/corporate-personhood.pdf

Citizens United v. FCC: Panel Discussion on Corporate Personhood

A panel discussion will examine both the legal and social implications of the recent Supreme Court decision in Citizens United v. FCC, which extended the meaning of free political speech to corporate expenditures in federal elections and thus granted broad First Amendment rights to corporations under the corporate personhood doctrine. The discussion, sponsored by the Kirwan Institute for the Study of Race and Ethnicity, will be held on Monday, April 12, at 6 p.m., in Saxbe Auditorium at The Ohio State University Moritz College of Law, 55 West 12th Avenue.

The Fourteenth Amendment weighs heavily in the origins of corporate personhood cases on which Citizens United depends, though the amendment’s original purpose was to grant slaves the status of “person.” Discussion will explore what the Citizens United decision means for social and racial justice, and the history of the Court and corporate rights.

Speakers will include john a. powell, executive director of the Kirwan Institute and Gregory H. Williams Chair in Civil Rights and Civil Liberties at the Moritz College of Law; Greg Coleridge, director of the Northeast Ohio American Friends Service Committee; and Cliff Arnebeck, chair of the Legal Affairs Committee of Common Cause Ohio and national co-chair and attorney for The Alliance for Democracy.

This event is free and open to the public.

The Kirwan Institute for the Study of Race and Ethnicity was established in 2003 as a center for interdisciplinary research at The Ohio State University. The Kirwan Institute partners with people, communities, and institutions worldwide to think about, talk about, and act on race in ways that create and expand opportunity for all. For more information about the Kirwan Institute, go to: http://kirwaninstitute.org/.

Flyer at http://www.afsc.net/PDFFiles/CitizensUnitedFlyer-final.pdf

Corporations’ perversion of civil rights law – Interested in writing about it for Race-Talk?

The 2010 Supreme Court decision Citizens United v. FCC was just another manifestation of a perversion of civil rights law since the Reconstruction amendments after the Civil War. Originally intended to protect newly freed slaves from virulent white racism, the 14th Amendment’s protections were quickly usurped, not by other people, but by American corporations. Indeed, of all the 14th Amendment cases between 1890 and 1910, 19 were filed by individuals seeking protection and 288 were filed by businesses.

Importantly, the expansion of corporate rights made possible by this perversion of the 14th Amendment was coterminous with the gutting of rights of the individual and in particular, of the African American individual. This continues today through our nations’ system of structural disadvantages. Think about Citizens United like this: the idea behind the Kennedy opinion is that you can’t discriminate against a speaker based on its corporate status (even when corporate status here mostly means vast and deep pockets of wealth looking to keep even more wealth through conservative government).

He believes this speech is the same as your political speech, protected because it is all part of the marketplace of ideas. In that fictional marketplace, buyers, when confronted with all available ideas, move closer to truth and naturally pick the best ideas. This is simply never going to be the case. Big money and flashy ideas always win.

Corporations will always have more spending power than individuals; they already have more lobbyists. Just as equality demands that we account for structural forces that make it easier for a wealthy white male to go to college than an impoverished Latina, so does it demand that we view Wal-Mart or Halliburton’s “free speech” as grossly disproportional to and fundamentally different than the free speech of individual (human) citizens. Allowing corporations unlimited amounts of spending power for campaign commercials of dubious truth can only further diminish and drown out the voices of the public. And all this in the name of equal protection . . .

In short, the perversion of equal rights by corporations is an affront to any true commitment on the part of this country to the civil rights envisioned by the framers of the Fourteenth Amendment.

If you are interested in writing for Race-Talk view our submission requirements.

Caitlin Watt
Legal Research Associate
The Kirwan Institute for the Study of Race and Ethnicity
The Ohio State University
(614) 247-1964
http://www.race-talk.org

Corporations and Democracy: The Citizens United Decision

Saturday, April 17
10 AM – Noon
Chagrin Falls Public Library
100 East Orange Street, Chagrin Fall

Presentation and discussion

Sponsored by Patriots for Change
http://www.patriotsforchange.org/