Wells Fargo’s at the Bottom of the Heap
BeyondChron - March 14, 2013, by Christina Livingston - When it comes to foreclosing on Californians, it looks like Wells Fargo may take the prize. According to a report released this week, Wells...
BeyondChron - March 14, 2013, by Christina Livingston - When it comes to foreclosing on Californians, it looks like Wells Fargo may take the prize. According to a report released this week, Wells Fargo is responsible for more homes in the foreclosure pipeline in California than any other single lender.
Wells Fargo is servicing the most loans, but they are providing less principal reduction to struggling borrowers than either Bank of America and Chase – who themselves should be doing more! Wells Fargo trails behind Bank of America and Chase when it comes to the amount of principal reduction given with first lien loan modifications, according to the Monitor of the multi-state Attorneys General settlement with the five big mortgage servicers.
This is the very same Wells Fargo that just had its most profitable year ever in 2012, with earnings of $19 billion.
The report, California in Crisis: How Wells Fargo’s Foreclosure Pipeline Is Damaging Local Communities, by ACCE (Alliance of Californians for Community Empowerment), the Center for Popular Democracy and the Home Defenders League, shows the harm coming to homeowners, communities and the economy unless Wells Fargo reverses its course and averts some or all of the impending foreclosures.
Click here to download the report.
The report uses data from Foreclosure Radar to look at loans currently in the foreclosure pipeline in California – meaning loans that have a Notice of Default or Notice of Trustee Sale. Of the 65,466 loans in the foreclosure pipeline, close to 20% of them are serviced by Wells Fargo.
If Wells Fargo’s 11,616 distressed loans go through foreclosure, California will take a next $3.3 billion hit: Each home will lose approximately 22 percent of its value, for a total loss of approximately $1.07 billion; homes in the surrounding neighborhood will lose value as well, for an additional loss of about $2.2 billion; and government tax revenues will be cut by $20 million, as a result of the depreciation.
And not surprisingly, African American and Latino communities will be particularly hard-hit. The report includes maps for seven major cities showing minority density and dots for each of Wells Fargo’s distressed loans. In city after city, they are heavily clustered in neighborhoods with high African American and Latino populations.
“My community has been absolutely devastated by the foreclosure crisis, and I put a lot of the blame at the doorstep of Wells Fargo,” says ACCE Home Defenders League member Vivian Richardson. “Wells Fargo’s heartless and unfair foreclosure practices are sending far more homes into foreclosure than is necessary.”
“Our communities and our entire State are still reeling from the housing crisis, and will be for years to come,” said San Francisco Supervisor David Campos. “As this report shows, the numbers of homes still facing foreclosure is enormous. Principal reduction is clearly a critical strategy for saving homes and stabilizing the economy. Wells Fargo and the other major banks should be doing more of it.”
The report recommends:
1. Wells Fargo should commit to a broad principal reduction program. This means that every homeowner facing hardship should be offered a loan modification, when Wells has the legal authority to do so. The modification should be based on an affordable debt-to-income ratio, achieved through a waterfall that prioritizes principal reduction and interest rate reductions. Junior liens must also be modified.
2. Wells Fargo should report data on its principal reduction, short sales, and foreclosures by race, income, and zip code. Wells Fargo must be more transparent about its mortgage practices. The bank has an egregious history of harming California’s African American and Latino communities through predatory and discriminatory lending. To show the public that it has reformed, Wells Fargo must make this data available. The people of California need to know that Well Fargo is no longer discriminating against people of color and is fairly and equitably providing relief to homeowners and to the hardest hit communities.
3. Wells Fargo should immediately stop all foreclosures until the first two demands are met In the event that it takes a few months to set up a fully functioning principal reduction program, Wells Fargo needs to immediately stop all foreclosures. Wells Fargo has done enough harm. It’s time to stop. California deserves a break.
ACCE is waging a campaign to push Wells Fargo to be a leader in California, their home state, in saving homes – beginning with their performance to comply with the Attorneys General Settlement and with the Homeowner Bill of Rights, but not ending there.
Click here to sign on to a letter to Wells Fargo CEO John Stumpf to support the campaign demands.
Author info: Christina Livingston is the Executive Director of the Alliance of Californians for Community Empowerment. ACCE is a multi-racial, democratic, non-profit community organization building power in low to moderate income neighborhoods to stand and fight for social, economic and racial justice. ACCE has chapters in eleven counties across the State of California. For more information visit http://www.calorganize.org/ or follow ACCE on twitter@CalOrganize
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‘Patriot’ Dimon dodges calls to disavow Trump policies
‘Patriot’ Dimon dodges calls to disavow Trump policies
By Ben McLannahan
Jamie Dimon endured a rough ride at the annual meeting of America’s biggest bank on Tuesday morning, as shareholders repeatedly attacked the JPMorgan Chase chief over his...
By Ben McLannahan
Jamie Dimon endured a rough ride at the annual meeting of America’s biggest bank on Tuesday morning, as shareholders repeatedly attacked the JPMorgan Chase chief over his ties to the administration of Donald Trump.
In December Mr Dimon was named chairman of the Business Roundtable, a group of almost 200 CEOs which is among the most prominent lobbying groups in Washington. Mr Dimon, chief executive of JPMorgan for the past 11 years and chairman for 10, is also a member of Mr Trump’s strategic and policy forum, which meets regularly to shape the economic agenda.
At the meeting in Wilmington, Delaware, a succession of shareholders challenged Mr Dimon to publicly disavow some of Mr Trump’s policies, such as his curbs on immigration from predominantly Muslim countries and his building a wall on the border with Mexico. One shareholder noted that users had sent more than 4000 messages to a website, backersofhate.org, urging Mr Dimon to “distance himself from hateful policies of human suffering”.
After staying silent throughout several speeches from the floor, Mr Dimon defended the bank’s record on Mexico, its support for lesbian, gay, bisexual and transgender people, and its funding of private prisons.
Finally, he said of Mr Trump: “He is the president of the United States, he is the pilot flying the aeroplane. I’d try to help any president of the US because I’m a patriot. That does not mean I agree with every policy he is trying to implement.”
Mr Dimon has long been the most outspoken of the big-bank chiefs in the US, often using his shareholder letter as a platform for taking positions on matters of public policy, and for challenging the regulatory framework put in place since the 2008 crisis.
In the weeks after the presidential election, the 61 year old was approached by members of Mr Trump’s transition team to serve as Treasury secretary but declined, saying he was unsuited to the role, according to people familiar with the discussions.
As hostile questioning resumed after his remarks at the Tuesday meeting, Mr Dimon tried to lighten the mood, saying “you’re starting to hurt my feelings”. The shareholder admonished him by saying that just by hearing him out, the chief executive would earn more than $100.
“I hope it’s worth it!” said Mr Dimon, who was paid $28m last year.
“This is not a laughing matter,” the shareholder replied.
The meeting stood in contrast to the peaceful gathering at the Goldman Sachs building in Jersey City at the end of last month, when chief executive Lloyd Blankfein faced just two questions from the floor, both of them friendly. Mr Blankfein, who is also chairman of the board, closed the meeting within just 24 minutes.
Mr Dimon wrapped up Tuesday’s proceedings by saying the entire board “takes this feedback seriously”.
Ana Maria Archila, co-executive director of the Center for Popular Democracy, said after the meeting that until Mr Dimon takes a stronger stand her organisation would continue to associate JPMorgan Chase with Mr Trump’s “anti-immigration” agenda.
Ms Archila arrived in America 20 years ago to reunite with her father, who had fled political violence in Colombia.
“I don’t think we have a plan to really inflict economic damages on the bank just yet,” she said. “But what we do have a plan for, is to force them to clarify whose side they’re on.”
Democrats are back in the fight for the Arizona Eighth Congressional District: All Bets are Off.
Democrats are back in the fight for the Arizona Eighth Congressional District: All Bets are Off.
Trump won by over 20 points, the Democrat leads in fundraising as well, aided in part by Ady Barkan, a wealthy Democratic activist with the Center for Popular Democracy who was recently diagnosed...
Trump won by over 20 points, the Democrat leads in fundraising as well, aided in part by Ady Barkan, a wealthy Democratic activist with the Center for Popular Democracy who was recently diagnosed with A.L.S. (Lou Gehrig’s Disease). In speaking with Bill Roe, the First Vice Chair of the Arizona Democratic Party, he indicated that this race is unpredictable for several reasons.
Read the full article here.
Letter: Congress must pass law for universal health care
Letter: Congress must pass law for universal health care
Here are the health care issues on which we need government to act...
Here are the health care issues on which we need government to act...
Read the full article here.
Why can't we get a vote on the one thing the parties agree on?
Why can't we get a vote on the one thing the parties agree on?
When the two parties adopted their platforms this summer, observers noted that the Democratic platform was possibly the most progressive platform in the recent history, while the Republican...
When the two parties adopted their platforms this summer, observers noted that the Democratic platform was possibly the most progressive platform in the recent history, while the Republican platform lurched even further to the right on a number of issues.
But on one topic (you'll be surprised which), they actually agreed: Breaking up too big to fail banks. Both parties' platforms include calls to re-instate the Glass Steagall firewall between boring banking (you know, lending money to people and businesses) and risky casino-style investment banking (think "credit default swaps").
Election day is fast approaching and Congress's approval rating has barely improved from a few years back when it lagged behind root canals. So you'd think agreement on a major policy -- particularly one with broad and deep public support -- might be occasion for swift enactment of a bi-partisan bill. Indeed, the 21st Century Glass-Steagall Act is championed by both Elizabeth Warren and John McCain, popular leaders in their respective parties. Instead, with Congress set to adjourn this week until after election day, Congressional leaders have yet to take a single step to live up to the words of their platforms.
Organizers of a new campaign to Take on Wall Street decided to do something about it. With strong support from the Daily Kos community and working with allies from labor, netroots, and community partners, we launched a petition to Congressional leaders asking them to back up their rhetoric on Glass Steagall with action. The petitions were gathered by the AFL-CIO, American Federation of Teachers, American Family Voices, Americans For Financial Reform, Campaign for America's Future, Center for Popular Democracy Action, Courage Campaign, CREDO, Daily Kos, EPI Policy Center, Franciscan Action Network, Jobs with Justice, Just Foreign Policy, People for the American Way, Presente.org, Progressive Congress Action Fund, the Nation, and Rootstrikers, generating over 350,000 signatures.
Yesterday we delivered those petitions on Capitol Hill, bringing them directly to the office of Republican Jeb Hensarling, Chair of the House Financial Services Committee. As Chair of the Committee that oversees the banks, Hensarling has had ample opportunity to show leadership on the issue. Instead he has spent the past two months advancing legislation that weakens oversight of the financial industry rather than strengthening it. Last week Chairman Hensarling held a vote in his committee on the highly partisan CHOICE Act -- an early Christmas present to Wall Street benefactors that repeals many of the regulations established by the Dodd Frank Financial Reform legislation enacted following the financial collapse in 2008. The prior week Hensarling pushed through a vote on the House floor that reduces transparency and disclosure rules for private equity firms.
Representative Hensarling was not in his office when we arrived but in addition to the petitions we delivered, we also brought to his office a reminder of the Republican Party's platform regarding Glass Steagall -- language that is remarkably clear and explicit: "We support re-instating the Glass-Steagall Act of 1933 which prohibits commercial banks from engaging in high-risk investment."
To be fair, not all Democrats support reinstating Glass-Steagall either. But Republicans have adopted a party platform that includes "tough on banks" references to Glass-Steagall while actively moving a Wall Street wish list of deregulation. That hypocrisy is egregious even by Washington standards.
Representative Hensarling isn't likely to change his tune, and as political observers delight in reminding us, the party platforms are not binding. But we should use even the rhetorical support for our agenda to hold elected officials accountable. And in the mean time, judge them by their actions not their words.
By jgreen612
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Bringing Black Voices to the Immigration Reform Debate
Bringing Black Voices to the Immigration Reform Debate
A Haitian American who grew up in Miami's Little Haiti community, Francesca Menes remembers the global cries for "Democracy for Haiti" following the 1991 coup. Amidst the current threats to...
A Haitian American who grew up in Miami's Little Haiti community, Francesca Menes remembers the global cries for "Democracy for Haiti" following the 1991 coup. Amidst the current threats to American democracy, she sees a reawakening of the political consciousness of American citizens and an opportunity to build real people power. As a longtime social justice activist and member of the Black Immigration Network'ssteering committee, Menes has learned to use her resources to lift up the voices of the most vulnerable.
Read the full article here.
BERNANKE’S FORMER ADVISOR: “PEOPLE WOULD BE STUNNED TO KNOW THE EXTENT TO WHICH THE FED IS PRIVATELY OWNED”
BERNANKE’S FORMER ADVISOR: “PEOPLE WOULD BE STUNNED TO KNOW THE EXTENT TO WHICH THE FED IS PRIVATELY OWNED”
With every passing day, the Fed is slowly but surely losing the game.
Only it is not just former (and in some cases current) Fed presidents admitting central banks are increasingly...
With every passing day, the Fed is slowly but surely losing the game.
Only it is not just former (and in some cases current) Fed presidents admitting central banks are increasingly powerless to boost the global economy, even if they still have sway over capital markets. What is far more insidious to the Fed’s waning credibility is when former economists affiliated with the Fed start repeating mantras that until recently were only a prominent feature in the so-called fringe media.
This is precisely what happened today when former central bank staffer and Dartmouth College economics professor Andrew Levin, special adviser to then Fed Chairman Ben Bernanke between 2010 to 2012, joined with an activist group to argue for overhauls at the central bank that they say would distance it from Wall Street and make its activities more transparent and accountable to the public.
Levin is pressing for the overhaul with Fed Up coalition activists. Many of the proposed changes target the 12 regional Federal Reserve Banks, which are quasi-private and technically owned by commercial banks in their respective districts.
All of that is not surprising. What he said to justify his new found cause, however, is.
“A lot of people would be stunned to know” the extent to which the Federal Reserve is privately owned, Mr. Levin said. The Fed “should be a fully public institution just like every other central bank” in the developed world, he said in a conference call announcing the plan. He described his proposals as “sensible, pragmatic and nonpartisan.”
Why is that stunning? Because it has long been a bone of contention if only among the fringe media, that at its core the Fed is merely a private institution, beholden only to its de facto owners: not the people of the U.S. but to a small cabal of banks. Worse, the actual org chart of who owns what is not disclosed, even as the vast majority of the U.S. population remains deluded that the Fed is a publicly owned institution.
As the WSJ goes on to note, the former central bank staffer said he sees his ideas as designed to maintain the virtues the central bank already brings to the table. They aren’t targeted at changing how policy is conducted today. “What’s important here is that reform to the Federal Reserve can last for 100 years, not just the near term,” he said.
And this is coming from a former Fed employee and Ben Bernanke’s personal advisor! That in itself is a most striking development, because now that the insiders are finally speaking up, it will be a race among both current and prior Fed workers to reveal as much dirty laundry as possible ahead of what is increasingly being perceived by many as the Fed’s demise.
To be sure, Levin’s personal campaign for Fed transformation will not be easy, and as the WSJ writes, what is being sought by Mr. Levin and the activists is significant and would require congressional action. Ady Barkan, who leads the Fed Up campaign, said the Fed’s current structure “is an embarrassment to America” and Fed leaders haven’t been “willing or able” to make changes.
Specifically, Levin wants the 12 regional Fed banks to be brought fully into the government. He also wants the process of selecting new bank presidents—they are key regulators and contributors in setting interest-rate policy—opened up more fully to public input, as well as term limits for Fed officials.
This would represent a revolution to the internal staffing of the Fed, which will no longer be at the mercy of its now-defunct shareholders, America’s commercial banks; it would also mean that Goldman Sachs would lose all its leverage as the world’s biggest central bank incubator, a revolving door relationship which has allowed the Manhattan firm to dominate the world of finance for the decades.
Levin’s proposal was made in conjunction with the Center for Popular Democracy’s Fed Up coalition, a group that has been pressuring the central bank for more accountability for some time. The left-leaning group has been critical of the structure of the regional banks, and has been pressing the Fed to hold off on raising rates in a bid to make sure the recovery is enjoyed not just by the wealthy, in their view.
The proposal was revealed on a conference call that also included a representative from Bernie Sanders’s presidential campaign, although all campaigns were invited to participate.
The WSJ adds that according to Levin, who knows the Fed’s operating structure intimately, says the members of the regional Fed bank boards of directors, the majority of whom are selected by the private banks with the approval of the Washington-based governors, should be chosen differently. The professor says director slots now reserved for financial professionals regulated by the Fed should be eliminated, and that directors who oversee and advise the regional banks should be selected in a public process involving the Washington governors and local elected officials. These directors also should better represent the diversity of the U.S.
Levin also wants formal public input into the selection of new bank presidents, with candidates’ names known publicly and a process that allows for public comment in a way that doesn’t now exist. The professor also wants all Fed officials to serve for single seven-year terms, which would give them the needed distance from the political process while eliminating situations where some policy makers stay at the bank for decades. Alan Greenspan, for example, was Fed chairman from 1987 to 2006.
As the WSJ conveniently adds, the selection of regional bank presidents has become a hot-button issue. Currently, the leaders of the New York, Philadelphia, Dallas and Minneapolis Fed banks are helmed by men who formerly worked for or had close connections to investment bank Goldman Sachs.
Levin called for watchdog agency the Government Accountability Office to annually review and report on Fed operations, including the regional Fed banks. He also wants the regional Fed banks to be covered under the Freedom of Information Act. A regular annual review hopefully would insulate the effort from perceptions of political interference, Mr. Levin said.
* * *
While ending the Fed may still seem like a pipe dream, at least until the market’s next major crash at which point the population may finally turn on the culprit behind America’s serial boom-bust culture, the U.S. central bank, Levin’s proposal would get to the heart of the most insidious conflict of interest in the US: the fact that the Federal Reserve works not for the people of America, but for its owners – the banks.
Which is also why, sadly, this proposal will be dead on arrival, as its passage would represent the biggest loss for Wall Street in the past 103 years, far more significant than anything Dodd-Frank could hope to accomplish.
By Zero Hedge
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Campaign Zero: A ‘Blueprint for Ending Police Violence’
On Friday, activists with the country’s growing racial justice movement unveiled a new campaign to end police violence, bridging protester demands with data and policy to create structural...
On Friday, activists with the country’s growing racial justice movement unveiled a new campaign to end police violence, bridging protester demands with data and policy to create structural solutions to the crisis that has gripped national attention for more than a year.
Launched as an online manifesto with an interactive website, Campaign Zero proposes new federal, state, and local laws that would address police violence and reform the criminal justice system—including demilitarizing law enforcement, increasing community oversight, limiting use-of-force, and requiring independent investigation and prosecution of police violence cases.
“More than one thousand people are killed by police every year in America,” the group states on its website. “Nearly sixty percent of victims did not have a gun or were involved in activities that should not require police intervention such as harmless ‘quality of life’ behaviors or mental health crises.”
The action plan also incorporates recommendations by the President’s Task Force on 21st Century Policing as well as those of research organizations like the Center for Popular Democracy. The architects behind Campaign Zero characterized it as a project that will continue to develop over time as new solutions emerge and more supporters come on board.
The four creators of the new campaign and authors of the manifesto—Samuel Sinyangwe, Brittany Packnett, Johnetta Elzie, and DeRay McKesson—are co-founders of We The Protesters, which as the Guardian notes is “a prominent section of a wider protest movement that is frequently referred to, in general terms, as Black Lives Matter.”
“This is just the beginning,” they wrote in a statement accompanying the launch.
In the year that has passed since 18-year-old Michael Brown was shot to death by an officer in Ferguson, Missouri, police have killed at least 1,083 Americans—an average of nearly three people per day, according to figures compiled by VICE News. Even that figure, released August 9, quickly became outdated.
The policy recommendations also call for an end the controversial practice of “broken windows” policing—a tactic that involves cracking down on petty infractions as a means to prevent more serious crime. The chokehold death of Eric Garner, who was targeted by police for allegedly selling loose cigarettes, heightened criticism of the policy, which Columbia law professor Patricia J. Williams said “has intimidated, dispossessed and humiliated millions of innocent people” for two decades.
Campaign Zero launches just as new reports highlight the lack of training and culture of aggression that permeates law enforcement agencies throughout the country. Addressing that issue in another policy demand, Campaign Zero states, “An intensive training regime is needed to help police officers learn the behaviors and skills to interact appropriately with communities.”
The group points to the recent successful overhaul of policing tactics in Richmond, California, a city which reduced its crime rate by 33 percent through community policing.
“We must end police violence so we can live and feel safe in this country,” Campaign Zero states.
Campaign Zero also introduces strategies for charting presidential candidates’ policy positions on such issues. Racial justice activists have recently engaged with the campaigns of candidates including Hillary Clinton, Bernie Sanders, Martin O’Malley, and Jeb Bush to demand action plans on addressing police brutality and criminal justice reform.
“Right now, the country is awake,” organizers stated. “We must continue to leverage this awakening for substantive change. We have an opportunity to change the way that issues in blackness are prioritized in political spaces and an opportunity to redefine how the political process interacts with our communities.”
“America is finally waking up to this very necessary and critical conversation about race, equity, and preserving the life and dignity of all citizens,” Packnett told the Guardian on Friday.
Added McKesson, “This is a blueprint for ending police violence.”
This Common Dreams article is reposted under a Creative Commons Attribution-Share Alike 3.0 License
Source: San Diego Free Press
Progressive Activists Take A Seat For The People At Federal Reserve Retreat
Progressive Activists Take A Seat For The People At Federal Reserve Retreat
Two years ago this week, the nonprofit Center for Popular Democracy and allied groups launched the Fed Up campaign, aimed at making the Federal Reserve more accountable to workers and communities...
Two years ago this week, the nonprofit Center for Popular Democracy and allied groups launched the Fed Up campaign, aimed at making the Federal Reserve more accountable to workers and communities of color. They converged then on the Jackson Lake Lodge in Wyoming, where Fed officials decamp every year to discuss policy and hobnob with the economic elite.
How much political headway has the campaign made since then? This year, Fed Up activists were essentially put on the schedule for senior Federal Reserve officials, with a major meeting at the Jackson Hole summit.
The group met Thursday, the first day of the summit, with eight of the 12 presidents of the regional Federal Reserve banks and two members of the Federal Reserve Board of Governors.
Fed Up activists have met individually with the governors and regional bank presidents before; they spoke with some Fed officials less formally at the past two Jackson Hole gatherings. This is the first time, however, that their delegation of some 120 rank-and-file activists had met with so many of the central bank’s decision-makers in one place.
“It is kind of like a mini-FOMC,” said Fed Up campaign manager Jordan Haedtler prior to the event, likening it to a meeting of the Federal Open Market Committee, the Fed’s policymaking body.
The progressive campaign is calling for the central bank to wait for the economic recovery to reach more broadly across America before raising its benchmark interest rate again, a move that slows the pace of economic growth to head off price inflation.
It has also criticized the Fed for the lack of racial, gender and professional background diversity among its senior officials, arguing that only a central bank that looks like America can craft policy in the best interests of all citizens.
The Fed officials at the meeting were Esther George, president of the Federal Reserve Bank of Kansas City, which hosts the annual symposium; New York Fed president William Dudley; Dallas Fed president Robert Kaplan; Minneapolis Fed president Neel Kashkari; Cleveland Fed president Loretta Mester; Boston Fed president Eric Rosengren; San Francisco Fed president John Williams; Richmond Fed president Jeffrey Lacker, and Fed governors Stanley Fischer and Lael Brainard.
“They were really impressed with how well prepared we were,” said Haedtler after the meeting. “They were heartened by the discussion.”
“We’ll see how things go in September,” he added, referring to the next opportunity for an interest rate hike.
Bill Medley, a spokesman for the Kansas City Fed, also gave positive feedback about the meeting.
“It was a productive dialogue, as it always is, and we look forward to continuing the conversation,” Medley said.
Fed Up has had a banner year so far. Democratic presidential nominee Hillary Clinton embraced the broad contours of its platform in May after weeks of private discussion with group representatives.
“Secretary Clinton believes that the Fed needs to be more representative of America as a whole as well as that commonsense reforms — like getting bankers off the boards of regional Federal Reserve banks — are long overdue,” a Clinton spokesman said at the time.
But Clinton stopped short of signing on to a bolder reform proposal that Fed Up rolled out in April, which would turn the central bank system into an entirely public institution. The Federal Reserve Board of Governors is already a federal agency, whose top officials are nominated by the president and confirmed by the Senate. But the 12 regional banks it supervises are owned by the private financial institutions they serve. (Fed Up released a more detailed version of its idea on Monday.)
The private nature of these banks is a major reason why they are run overwhelmingly by white men with backgrounds in finance, Fed Up argues. There has never been a black or Latino president of one of the regional banks, the group notes in its reform proposal, and one-third of the current bank heads are alumni of Wall Street power player Goldman Sachs.
Fed Up’s moment at this year’s Jackson Hole symposium was not without its hiccups.
Earlier this month, Fed Up were informed that the Jackson Lake Lodge had canceled over a dozen of its room reservations. The hotel said a “computer glitch” had led to the overbooking of 18 rooms. But the fact that 13 of those rooms were booked by Fed Up raised concerns that they were being targeted.
Although the activists found lodging at a nearby resort, Fed Up filed a complaint with the U.S. Department of Justice, and members of Congress sympathetic to their cause sent Fed Chair Janet Yellen a letter asking for an explanation.
In an apparent gesture of detente, George, the Kansas City Fed president, offered Fed Up the big meeting, and the campaign withdrew its objections to the lodging snafu.
Fed Up agreed also to limit its presence in the lodge’s halls during a scheduled cocktail hour. In the past, activists have clustered inside the hotel to confront Fed officials in person. The group held a press conference-cum-rally outside the lodge before Thursday’s meeting. It also plans to run teach-in seminars and to canvass the city’s low-income neighborhoods to spread the word about Fed reform.
But Haedtler, Fed Up’s campaign manager, wanted to focus on Thursday’s meeting. It is evidence, he said, that his fledgling movement’s priorities have made it into the mainstream.
“We have clearly reshaped the discourse,” Haedtler said.
By Daniel Marans
Source
Why You Should Care About the Federal Reserve’s Secrecy and Elitism
New Republic - Last weekend, Cee Cee Butler, a 34-year-old McDonald’s worker from Washington D.C., became sick with the flu, or at least something that resembled the flu. Her phone had been cut...
New Republic - Last weekend, Cee Cee Butler, a 34-year-old McDonald’s worker from Washington D.C., became sick with the flu, or at least something that resembled the flu. Her phone had been cut off and she missed work Friday, Saturday and Sunday. “I did a ‘no-call, no-show’ for three days and I’ve never done that in over the year and a half I’ve been working here at McDonald's,” she said. “They terminated me Tuesday morning. So I lost my job, my rent is going up in December, I have two kids—19 and 5, a girl and boy—and I can’t afford to take care of them.”
On Friday, Butler gathered outside the Federal Reserve building with around two dozen activists from labor unions and progressive groups before an afternoon meeting with Fed Chair Janet Yellen. The groups are part of a new campaign called “Fed Up” that is pressuring Yellen and her colleagues to keep interest rates at zero until the recovery strengthens and wages rise. “The economy is not working for the vast majority of people,” said Ady Barkan, a lawyer from The Center for Popular Democracy, which is the lead organizer of the campaign. Fed Up wants to rectify that problem by putting direct pressure on the Federal Reserve itself—a quest that may not captivate the public’s attention but could have a very real effect on the lives of working Americans.
In August, for instance, members of Fed Up staged protests outside of the Federal Reserve’s annual monetary policy conference in Jackson Hole, Wyoming. Many reporters there said it was the first time they could remember protestors at the conference—but their tactics must have worked, because Yellen agreed to meet with the protesters Friday afternoon in the boardroom where the Federal Open Markets Committee (FOMC) meets eight times a year to set monetary policy. Three other Federal Reserve governors—Vice Chair Stanley Fischer, Jerome Powell and Lael Brainard—joined the meeting and the activists said that Yellen was engaged throughout and was moved by the stories she heard. They hope that this meeting was just the first of many in the future.
The message the Fed Up campaign delivered is the same one voters sent loud and clear last week: The recovery is not being felt by millions of Americans. Exit polls indicated that 45 percent of voters considered the economy the most important issue of the midterms. Wage growth for low-income workers, like janitors and fast food workers, are barely keeping up with inflation. “That’s not an economic recovery,” said Jean Andre, who does location support for film production and is a member of New York Communities for Change. “That’s not the way thing should be.”
But the slow recovery isn’t always noticeable in leading economic indicators. The unemployment rate, for instance, has fallen 2.1 percentage points since the start of 2013 and is now at 5.8 percent, its lowest point in more than six years. As a result, some economists inside and outside the Fed, including inflation hawk Charles Plosser, have called for a hike in interest rates in the near future. “Beginning to raise rates sooner rather than later reduces the chance that inflation will accelerate and, in so doing, require policy to become fairly aggressive with perhaps unsettling consequences,” Plosser, the president of the Federal Reserve Bank of Philadelphia, said Wednesday.
Plosser’s worry about rising inflation, even though it is nowhere to be found, could prove dangerous. If the FOMC listens to the hawks, it will prematurely raise rates and choke off the recovery before workers see wage growth. So far, Yellen has done a good job ignoring Plosser and Co. And, luckily, Plosser and Richard Fisher, the president of the Dallas Federal Reserve Bank and another hawk at the FOMC, announced that they would retire in the spring of 2015, opening up two positions that have a significant impact on monetary policy. Fed Up sees their retirements as a boon—and is keen to have a say in the selection process.
Under the current rules, Plosser and Fisher’s replacements will be chosen by the board of the Philadelphia and Dallas reserve banks, respectively. Each board has nine members, three from banks and six from nonbanks—companies and organizations that are not financial institutions. Because of Dodd-Frank restrictions, only the six non-bank members are involved in selecting the replacements. But of those six members, three are chosen by banks and three are chosen by the Fed board in Washington. Workers and consumers are supposed to be represented on the board, but of the 108 members, 91 are from financial institutions and corporations. Just two are leaders of labor groups and another 15 represent non-profit organizations.
Fed Up has a list of demands to make the replacement process more transparent and to ensure the public has adequate representation within the central bank. They want a public schedule of the process, a list of criteria for how the replacements will be chosen, a chance for members to question the candidates, and public forums where citizens can discuss monetary policy with candidates and the search committee. These reforms, they hope, will keep presidents like Plosser and Fisher—who activists say are disconnected from the daily struggles of their constituents—out of office. “We need a president in Philadelphia who will listen to working people,” said Kati Slipp, the director of Pennsylvania Working Families. “Charles Plosser hasn’t been or he would not believe that our economy has really recovered.” In fact, Fed Up is already getting results. On Friday morning, the Philadelphia Fed announced that it was setting up an email to receive inquiries about the search process. “That would never have happened if this campaign hadn’t happened,” Slipp said. The campaign said it expected the same things from the Dallas Fed.
After Republicans destroyed Democrats in the midterms, many liberal commentators argued that a fresh agenda for raising wages could help the Democratic Party win back voters, particularly those in the white working class. But the problem isn’t that Democrats’ ideas—raising the minimum wage, investing in infrastructure and strengthening the safety net—won’t help middle- and lower-class Americans. It’s that the weak recovery has destroyed those ideas’ political salience. It’s a political problem much more than a policy one.
Such arguments almost always ignore monetary policy. After all, no one but Ron Paul fanatics care about the Federal Reserve. And the Fed is independent from the federal government. If a Democratic candidate’s economic message was to fill the FOMC with economists committed to keeping interest rates low or even adopting a different monetary policy regime altogether, voters would likely roll their eyes. It would be a political disaster. But given congressional gridlock, it might also be far more effective at boosting the recovery.
The Fed Up campaign isn’t going to change that. Millions of Americans will not suddenly realize that the most important economic actor in the United States is not the president or Congress but the Federal Reserve. They will not understand that some inflation is needed, especially right now, to convince businesses to invest and consumers to spend money to get the economy back going again. But the campaign may convince some Americans of the Fed’s importance. That’s why Cee Cee Butler, the former McDonald's worker who was fired Tuesday, and Jean Andre, the man who scouts out locations for films, spent a cold Friday morning outside the Fed.
“I just got out of the shelter two years ago and here I am about to be back in one. I’m not trying to go back there,” Butler said. “My daughter will never walk in my shoes. She doesn’t need to. That’s why my voice needs to be heard.”
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9 days ago
9 days ago