It is pretty audacious for me to claim that any given report is the most important one to be issued in the next two years given that I obviously have no idea what else is going to be published. I am feeling fairly confident about this one, though. It's not because the facts assembled are so groundbreaking, or the research goes deep to find things no one else could have found. It is because this report is a clear roadmap to the economic and political path the Obama White House should be taking. The report, Big Banks Bonus Bonanza, was issued by SEIU, National People's Action, the PICO National Network, the Northwest Federation of Community Organizations, and the Alliance of Californians for Community Empowerment. It makes the case strongly for an economic play that would give the country a far bigger economic boost than anything Obama is going to be able to get out of Congress the next two years, and a political master stroke that would completely shift the political dynamics in the country.
I wrote about the broad economic strategy of forcing the banks to write down mortgages on Tuesday, but this report does a great job of laying out the numbers in stark detail. Bank robber Wee Willie Sutton famously said that the reason he robbed banks was because that was where the money was, and if we are looking to get our economy moving again, we should be looking to get the money to do it where the money is. Right now, more than ever, the big banks are where the money is concentrated. The most important fact by far in Big Banks Bonus Bonanza is this one: right now, 11 million American homeowners owe $766 billion more on their mortgages than their homes are worth, but if the banks were to write down those mortgage principals to market value and refinance them into 30 year fixed rate loans, you would get $73 billion pumped directly back into the economy- every year for the next 30 years.
Now unlike extending tax cuts for the rich or reducing the estate tax, which tends to be saved and invested in long term bonds, this money would go directly into stimulating the economy and creating jobs. Think about who those 11,000,000 underwater homeowners are: they are almost entirely middle and working class families who have spent the last couple of years sweating bullets to save their main life investment after its value plummeted by 20%, 30%, or more. They haven't been spending money on new products, they haven't been taking any vacation trips with their families, if they own a little mom and pop business they sure haven't been taking any risks to expand it: they have just been desperately scrimping and saving and trying to hang on by the skin of their teeth. But if their mortgage is reduced to what their house is actually worth in today's market, that means their overall financial situation is far more stabilized, and it means their monthly mortgage payment will go down as well.
With a stabilized debt and lower monthly mortgage payments, with the psychological weight of probable foreclosure off their shoulders, these middle class homeowners (at least the ones with jobs, which is most of the folks who still have homes) are exactly the kind of people who will be likely to start spending a little money in this economy. Maybe they will finally buy the car they have been holding off on now for years. Maybe they will do a little home improvement now that they know they will be able to stay in their home. Maybe they will feel able to finally make the investment in their small business they have been wanting to make, and hire a few extra folks as a result. The economic multiplier effect of this $73 billion would be as good as any money injected into the economy right now.
You want to know what the second most important fact in this report is? The 73 billion dollars it would cost to write down those mortgages would be only half what the top 6 banks alone are getting ready to write in bonuses and compensation for 2010. If forced to write down these mortgages, the banks will scream bloody murder, even claiming it would endanger them and the entire economy. But all they have to do is cut their bonus and compensation packages, the vast majority of which go to top executives and traders, by 50%. Given all the cash these banks are sitting on, all the profits made and bonuses distributed in recent years, I have no doubt they can afford the hit. The ironic thing is that if they wrote down these mortgages, they would be getting monthly mortgage checks from all these homeowners, plus avoid the costs of all those foreclosure proceedings, but they don't want to write down the property because of their own phony accounting that claims the properties are worth far more than they actually are.
So here's the other little nugget the report alludes to: if you injected 73 billion dollars into the economy through these write downs, the multiplier effects I was referencing earlier- homeowners being able to free up cash to buy things and invest in small businesses and do home improvements- would mean 1.8 million new jobs. That is a lot of jobs, folks: enough to drop the unemployment rate from the almost 10% it has been sitting at for a very long time down to the mid 8s. And it would finally begin to stabilize the housing market, which would do a lot for the economy all by itself.
All of these good economic tidings would be great for the President politically of course, but what would matter more than anything is that him taking strong action to take on the banks on behalf of economically pressed homeowners would do immeasurable good to his political standing in general. He wouldn't be going to Congressional Republicans hat in hand, begging them to do the right thing on some piece of legislation that would never get passed. He wouldn't be having to choose what compromise to make. He could show both the Democratic base and middle class swing voters that he was taking a strong stand on their behalf against a very powerful interest. Working alongside the state Attorneys General and tens of thousands of community activists working on this issue, he could order every agency in government- Treasury, DOJ, Fannie, Freddie, HUD, FHA, etc- to exert maximum pressure on the big banks to write down these loans. That kind of strong decisive leadership would do wonders on his behalf.
Obama showing strength and leadership on this issue could help turn both the nation's economy and the President's political fortunes around. For his sake, and the country's, my biggest Christmas wish this year is that he takes this fight on.
Sometimes stories happen because of planning; other times serendipity intervenes, which is how we got to the conversation we'll be having today.
In an exchange of comments on the Blue Hampshire site, I proposed an idea that could be of real value to unions, workers...and surprisingly, employers.
If things worked out correctly, not only would lots of people feel a real desire to have unions represent them, but employers would potentially be coming to unions looking to forge relationships, and, just to make it better, this plan bypasses virtually all of the tools and techniques employers use to shut out union organizers.
Since I just thought this up myself, I'm really not sure exactly how practical the whole thing is, and the last part of the discussion today will be provided by you, as I ask you to sound off on whether this plan could work, and if so, how it could be made better.
It's a new week...so let's all put our heads together and rebuild the labor movement, shall we?
I wrote the other day about all the ironies abounding in the elections, especially Mitch McConnell's protégé being destroyed by the tea partiers while Mitch was in DC taking care of Wall Street's business. But the irony doesn't stop with electoral or legislative politics at all. Now Glenn Beck, of all people, is attacking poor people who are losing their homes for having the gall to protest against the bankers.
Remember, Beck is the same guy who has been cheering the tea partiers on, urging anti-Obama forces to protest vehemently and loudly every single chance they get. But when people who are losing their homes after getting mistreated by Bank of America dare to protest, he gets all squeamish. Suddenly, they become dangerous "mobs" threatening children.
Beck and his banker buddies sure do have glass jaws. There was no violence at this protest, no threats of violence, no hint of it: just a bunch of folks protesting bankers who have destroyed millions of jobs and cost millions of people their homes by their recklessness.
Last week's fascinating and extremely well-done Huffington Post piece about the progressive movement and power in light of the last year plus of the Obama administration, along with a trip to California that I did to go to a board meeting and fundraising event for the Congressional Progressive Caucus Foundation and 501(c)4, has been making me think a lot about what progressives will need to do to build power in the coming years. Add to that this stunning news about Andy Stern deciding to retire as SEIU President, and it's a big day for thinking about the progressive movement.
Andy's tenure as SEIU President has been a dramatic reminder of both the promise and frustration of trying to make progressive change in 21st century America (disclaimer: OpenLeft partners on a financial basis with SEIU from time to time). Before he ever became SEIU President, he was an integral part of making SEIU the fastest-growing union in the country, and of the dramatic and surprising insurgent campaign inside the AFL-CIO to force Lane Kirkland's retirement and then beat his heir apparent Tom Donahue. Since becoming President, he has been a co-founder of a series of huge new progressive organizations (including America Coming Together in 2004, the Democracy Alliance, America Votes, and Change to Win) that have moved several hundred million dollars into progressive organizing, and he has helped both end Republican rule in Congress and elect a Democratic President against two of the most powerful entrenched establishment figures in DC (Hillary Clinton and John McCain). The 2009 stimulus package that invested hundreds of billions of dollars in long-time progressive priorities, the federal budget that was the most progressive budget since the 1960s, and a universal health reform bill all had Andy as prime movers. He is President Obama's closest progressive ally, and former SEIU staffers are distributed throughout the Administration.
But for all that, the limits to progressive power are clear. The labor movement has not seen a dramatic resurgence in new membership or political power. The stimulus package was too small to keep the unemployment rate from rising to the 10% range and being stuck there for months. The health care bill was deeply compromised by health insurance and pharmaceutical company power. Other top SEIU priorities like financial reform, the Employee Free Choice Act, and immigration reform are yet to pass and will be far weaker than they should be even if they do pass. Corporate power in DC is still ascendant, and progressives for the most part feel ignored by the White House.
None of this is Andy's fault, but his story is the quintessential story of the modern progressive movement. He, and we, have been able to shake things up, create innovative strategies and institutions, get some good things to happen. Our accomplishments should not be discounted or trashed, even when we have fallen short of our ultimate goals. But we have yet to truly change the essential power dynamics in this country. The simple fact is that change in this era is complicated as hell. Those who think that any one strategy- electing a President, getting a majority in Congress, complaining about that President and Congress, lobbying that President and Congress, innovative organizing or media or online tactics, or anything else- will get the job done is fundamentally wrong. It will take all of this and more: we have to be constantly opening up new fronts in the battle, changing our tactics, adding to our progressive infrastructure.
What is most important is that we don't give up the fight. All of the disappointments I have written about above do not make the progress I mentioned any less valuable or important. A Democratic Congress is better than a Republican one. Barack Obama is a better President than John McCain would have been. Establishing a right to universal health care and ending discrimination based on pre-existing conditions is a step forward. Hundreds of billions of dollars into low-income programs and jobs and education and green jobs is better than not funding those things at all.
Figuring out new strategies for increasing progressive power is our challenge, but we can stand on the platform of what's been built by Andy and progressive movement activists all over the country.
Apparently inspired by certain Democrats voting against the health insurance reform, the Service Employees International Union - a union representing over 2 million workers - is surprisingly planning to work against Democrats this election season.
Perhaps the strongest challenge to Democrats, if not the Democratic establishment itself, will be in North Carolina. The national SEIU is working with the State Employees Association of North Carolina, its state affiliate, to form the North Carolina First Party.
While President Obama signed the final piece of the health care reform bill into law on Tuesday, opponents are not taking the defeat lying down. This week's prize for the most bizarre objection to health care reform goes to Glenn Beck's guest host Doc Thompson who alleged that a tax on tanning salons is racist. Andy Kroll of Mother Jonesexplains:
Filling in for Glenn Beck on his radio show, conservative radio host Doc Thompson recently made the stunningly outrageous claim that a tax on indoor tanning salons, as included in the health care reform bill, is racist. Such a tax, Thompson claimed, discriminates against "all light-skinned Americans" because only white-skinned Americans use tanning salons. Never mind the deadly effect tanning beds and the like have on your skin and health, nor the fact that the tax would generate $2.7 billion over ten years to help pay for health care. No, that couldn't have anything to do with why the tax was included in the health care bill.
Governors vs. AGs
Christina Bellantoni of TPM Election Central reports that various Republican state attorneys general are clashing with their Democratic governors over plans to challenge health care reform in court. When Michigan Attorney General Mike Cox (R) joined an anti-reform lawsuit, Gov. Jennifer Granholm (D) reminded everyone that "no one in the executive branch has authorized [Cox] to take this position." The lawsuits are a good way to grab media attention, but Cox and his fellow AGs may end up with egg on their faces if these challenges actually go to court.
Reform and the Constitution
Some anti-reform activists allege that health care reform is unconstitutional because the government doesn't have the right to force people to carry health insurance (aka the "individual mandate"). On, The Breakdown podcast, Chris Hayes of the Nation interviews Gillian Metzger a professor of constitutional law at Columbia who explains why the constitutionality of health care reform is "pretty much a no-brainer." Another Nation contributor, Aziz Huq, puts it this way: "Among constitutional scholars, the puzzle is not how the federal government can defend the new law, but why anyone thinks a constitutional challenge is even worth making."
SEIU Sues Dissident Local
Speaking of lawsuits, Carl Finamore of Working In These Times is covering a major court battle in California between two large health care unions. The 1.8 million-member Service Employees International Union is suing the former elected officers, staff and organizers of its third-largest national affiliate, United Healthcare Workers-West (UHW). The 26 defendants defected from SEIU to form a new union, National Union of Healthcare Workers (NUHW), which is also being sued. The conflict started a few years ago when national SEIU decided to remove 65,000 health care workers from a UHW local without the local's consent. Finamore sees this lawsuit as a test of the principle of local self-governance: can SEIU sue a dissident local into submission?
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Written by Socialist Appeal
Wednesday, 12 August 2009
On Thursday, August 6th, following a town hall meeting staged by Representative Russ Carnahan (D-MO) in St. Louis, MO to tout President Obama's health reform plan, violence was instigated by right-wing "protesters" against members of the Service Employees International Union. The SEIU members, three organizers and a shop steward, had turned out to demand health care for all. Among the SEIU members was recent St. Louis Mayoral candidate Rev. Elston McCowan, who ran an independent campaign on the Green Party ticket, fighting for single-payer health care and concrete measures to create jobs and defend public education. McCowan was assaulted by "tea party" protesters and his shoulder was dislocated. He was also arrested along with other SEIU members, for the "crime" of defending themselves against the right-wingers. The town hall meeting itself was disrupted inside by right-wing hecklers, who created a charged atmosphere.
This incident has been seized upon by right-wing media outlets such as Fox News and the O'Reilly Factor, who are falsely laying blame on "SEIU thugs" (according to the O'Reilly Factor) for the violence. In the days following Thursday's town hall meeting, the "tea party" organizations staged a protest outside the union's offices. To add insult to injury, Rep. Carnahan appeared on television this past weekend to condemn the right-wingers and the SEIU! Another town hall meeting on health care reform scheduled for Saturday, August 8th was canceled due to fears of disruption and violence.
These "tea party" groups, funded by the Republican Party and the big health insurance corporations, are shills for big business. Made up mostly of middle class and wealthy people, these "grass roots organizations" are being whipped into a frenzy of fear fed by misinformation and have been let loose in order to disrupt public discussions on health care in St. Louis, MO, Tampa, FL, and Orlando, FL so far, even meetings organized by the big-business backed Democratic Party to discuss Obama's health plan.
Let's be clear: Obama's plan in no way represents a single-payer, socialized health care system. Obama's plan in fact will continue to make room for the multi-billion dollar HMO and pharmaceutical companies, who are literally sucking the life blood of working people in the name of big profits for the wealthy. The Democratic plan is more of the same. Republican news outlets and commentators are attempting to confuse the public by making Obama's plan synonymous with a single payer health system. This kind of misinformation is feeding the "tea party" mobs.
These people are encouraged to use goon tactics to shut down, disrupt and even force the cancellation of meetings and to intimidate and attack union members and who attend these public meetings to discuss the all-important issue of health care. Enough is enough - the Labor Movement needs to mobilize its forces to defend democratic rights and place genuine reform - single-payer health care - on the agenda!
The SEIU union has now committed itself to standing up to the "tea party" groups. The union released a statement, saying:
"Let's be clear: These groups, backed by insurance companies and corporate front groups, want nothing more than to preserve the status quo system of rationing, where HMOs choose doctors, and insurance companies deny us the care we need. Their dearest hope is that by resorting to outrageous charges of Nazism and euthanasia, they can make the American public too afraid to support real reform.
"But SEIU and hardworking women and men all over this country are standing up to their bullying tactics. We deserve a national conversation about how we will fix our failing healthcare system and help make this an economy that works for everyone."
This call to stand up to goon tactics and for a genuine national discussion on health care reform should be supported by the whole Labor Movement and all working people, students and activists. If the unions were to mobilize the membership and working people generally to attend such public discussions, and to organize stewards and members to protect such meetings from violence and disruption, this would be a big step forward and ensure a place for working people to participate. The unions should also reach out to the millions of unemployed workers, who are without health care of any kind, and get them to join this fight. The right to democratic expression must be defended and maintained absolutely. Beyond that, if the unions were to mobilize nationally to demand single-payer health care reform, in every town and city and in every state across the nation, it would show the real balance of forces. Without the working class' kind permission, not a wheel turns nor a lightbulb shines. Such mobilizations would show the "tea party" protests for what they are: an insignificant whimper of a marginal section of the population.
The Workers International League extends its support and solidarity to the SEIU membership and to the Rev. Elston McCowan, who have been made the targets of the right-wingers. We also believe that the only fundamental health care reform is one that takes the giant HMOs and pharmaceutical companies out of the equation: a single-payer, socialized national health care system which would guarantee full access for all to the latest treatment, research and discoveries. Abolish the HMOs and nationalize the pharmaceutical giants that squeeze their profits from the health of working people! A lead towards mobilizing to fight for single-payer health care has already been given by many unions across the U.S., organized through the Labor Campaign for Single-Payer Health Care conference. We believe that if this demand were to be taken up by and fought for by the whole of the Labor Movement, it would be the best route towards real, fundamental reform of the country's health care system and in the best interests of the vast majority of the population - working people.
Labor Mobilize to Defend Democratic Rights and Demand Single-Payer Health Care!
This week's edition of the Weekly Pulse is shorter than usual. Our team is getting ready for the fourth annual Netroots Nation blogger conference in Pittsburgh, PA. Esther Kaplan, editor of the Nation Investigative Fund, and I are conducting an investigative reporting workshop on Saturday from 1:30-4:15 p.m. Join us and help expose the corporate roots of the Teabagger/Town hall mob movement.
Here's the latest news on the healthcare front: Republicans and their allies are pressuring Democratic healthcare reformers at townhall meetings around the country. Addie Stan has a blockbuster piece in AlterNet that exposes the network of corporate funders and lobbyists behind the mobs.
The Progressive's Ruth Conniff explains the mobs' marching orders, as spelled out in a memo by Bob MacGuffie, a volunteer for the Tea Party Patriots, an anti-reform group with ties to former Republican Rep. Dick Armey's pressure group Freedom Works. MacGuffie instructs town hall protesters to shout at lawmakers and attempt to throw them off their game as they try to make the case for health care reform. So much for reasoned discussion.
As I reported in In These Times, the teabaggers are trying to scapegoat organized labor as the instigators of confrontations at town hall meetings. On August 6, a scuffle broke out in front of a town hall meeting in St. Louis. This video clip shows the last 10 seconds of a scuffle in which a man in an SEIU t-shirt lies prostrate on the ground. A 38-year-old conservative activist claims to have been severely beaten, but the video shows him apparently uninjured, darting around to different cops and trying to convince them that he was attacked. The man's lawyer claims that he saw his client get punched in the face and kicked in the head by SEIU members.
A spokesman for the St. Louis County police told me that the police hadn't reviewed the video because nobody had submitted it to them, despite a call to the public to turn over evidence for the investigation. The fact that the videographer hasn't turned over the video kind of makes you wonder if the teabaggers really take the "evidence" as seriously as they claim.
How's this for irony? According to Talking Points Memo, the activist was asking for money to pay his hospital bills because he's uninsured.
Finally, Jodi Jacobson of RH Reality Check reports that Kansas Now is calling upon AG Eric Holder to restore the Federal Marshall security detail of prominent late-term abortion provider Dr. Leroy Carhart, a friend and colleague of the late Dr. George Tiller. Carhart was placed under protection after Tiller was shot. But the feds didn't even wait for the trial of Tiller's alleged assassin to wrap before pulling Carhart's detail. Now he's on his own, just as the alleged killer's links to a broader coalition of violent anti-choicers are coming to light.
This post features links to the best independent, progressive reporting about healthcare and is free to reprint. Visit Healthcare.newsladder.net for a complete list of articles on healthcare affordability, healthcare laws, and healthcare controversy. For the best progressive reporting on the Economy, and Immigration, check out Economy.Newsladder.net and Immigration.Newsladder.net. This is a project of The Media Consortium, a network of 50 leading independent media outlets, and created by NewsLadder.
Wells Fargo is a roadblock to economic recovery. That's what members of the United Electrical, Radio, and Machine Workers (UE) are claiming, as they literally blocked a busy Rock Island, Illinois intersection late last week to protest Wells Fargo's decision to cut off credit to the Quad City Die Casting factory.
100 Quad City factory employees risk losing their jobs if Wells Fargo doesn't extend tens of thousands of dollars in credit to continue day-to-day operating costs. So why won't Wells Fargo use some of its $25 billion in bailout funds to keep this factory afloat, particularly when the Illinois-Iowa Quad Cities region is losing $6.1 million in wages and tax revenue annually? According to UE organizer Leah Fried, "[Wells Fargo] want[s] to get out from under the TARP money because they want to get out from the scrutiny. They're hoarding." Wells Fargo has even gone so far as to prevent the company from paying the wages and benefits owed to its employees, which prompted UE to file charges with the National Labor Relations Board last week.
Across the country, we're seeing more and more protests this one. As journalist/labor activist Mike Elk recently noted, these public demonstrations are highly effective ways of bringing national attention to the bailed out banks that are cutting off credit and have done pathetically little to jump-start our ailing economy. We saw this last December, when laid-off UE workers held sit-ins at Republic Windows and Doors in Chicago because Bank of America and JPMorgan Chase wouldn't fork over credit for the company to pay severance.
One of our spies snuck into a meeting of the evil right-wing group HAARM (Healthy Americans Against Reforming Medicine) last week and uncovered a nasty plot to undermine efforts toward healthcare reform. Prepare to be shocked, disgusted and amused:
If this all sounds a bit unlikely to you, you're half-right: the video is the first in a series that Laughing Liberally, our national comedy tour at Living Liberally, has been working on with SEIU. The video is (we hope!) funny, but the situation it depicts couldn't be more serious - there are real efforts by moneyed interests, meeting as we speak, to make universal healthcare sound like a bad thing.
Every once in a while, a moment comes along where you get pleasantly surprised by the nice things people do and say on your behalf, and this is when one of those times. When Chris first mentioned the idea of doing a fundraiser for OpenLeft, it seemed like a good idea, because on a very practical level with ad revenue down, we really needed the money. I figured we would make the goal after begging and pleading a bit, especially because I knew how important many folks realize Chris is to the blogosphere, and because I know people appreciate the range and depth of our other writers here. I had no idea, though, how much I would be moved by the response. Not just the overall numbers, because of so many different people helping out, but the kind of generosity and comments made by all kinds of great people in progressive politics. SEIU's incredible gesture, part generosity and part great organizing strategy; Debra Cooper's awesome matching gift, so quickly acted upon; all the great people, so many of you progressive heroes and leaders yourselves, who have helped out; and especially for all the incredibly kind and supportive comments. It has made me very proud and thrilled.
Go to this webpage and sign up for SEIU's health care fight. It is a rare win-win-win: you get to join the fight for the public option, support Open Left, and support SEIU, with one easy, 30 second action. This is a real chance to build the progressive movement, and it is free.
The Open Left fundraising has gone better than my wildest dreams, and I feel very humbled as a result. Let's continue to support Open Left, but to do so in a way that also supports a cause that is winnable and of paramount importance: public health care. Sign up to join SEIU's health care fight now!
This week, the White House teamed up with healthcare industry giants for a two-day PR blitz on health reform. A coalition of industry leaders sent a letter to president Obama over the weekend, pledging to help contain healthcare costs. The signatories include PhRMA (drug makers), Advamed (device manufacturers), the AMA (doctors), the AHA (hospitals), AHIP (health insurance), and SEIU's Health Care project. The corporate signatories are the very same interest groups that have fought U.S. healthcare reform for generations. AHIP, America's Health Insurance Plans, helped torpedo the Clinton plan in the 1990s with the infamous "Harry and Louise" TV spots.
There's some great news on the labor front coming out of newly announced labor appointments. There are a whole host of positions to be appointed in both the Department of Labor and the National Labor Relations Board. Progressive appointments here give us a chance to re-shape labor policy through administrative processes and help expand the power of workers in the 21st century.
Follow me over the fold and we'll meet some of these appointees.
This diary is mostly derivative of the SEIU blog, but I felt this was a blog post worth sharing among many people and a cause worth supporting:
I have a story for you.
Two CEOs lead two large public companies that start sinking, putting thousands out of work and toppling the American economy. Both CEOs accepted billions in taxpayer dollars to sustain their companies, but both failed to stop their companies' downward spirals.
One CEO -- GM's Rick Wagoner -- got his pink slip from President Obama this morning. The other -- Bank of America's Ken Lewis -- accepted bailout funds while continuing to fleece consumers and taxpayers.
It's time for the Obama Administration to show the door to CEO Ken Lewis in order for real reform to take hold at Bank of America.
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