Action - Represent Consumers

For lobbyists and their bosses, budget crisis is big winner

Turns out not everybody was distressed that Congress has been tied up in knots for months obsessed with the self-imposed fiscal cliff crisis.

The lobbying industry, which had previously been in the dumps because of the do-nothing Congress, came roaring back to life in 2012, due in large part to the prolonged budget crisis.

According to the Center For Public Integrity, about half of the country’s top 100 lobbying firms spend more in the fourth quarter last year than they did in the third quarter, and about half showed an overall increase for 2012 over the previous year.

The top spender was the U.S. Chamber of Commerce, which laid out a whopping $125 million in 2012, an 88 percent increase over the previous year. That doesn’t include the $36 million they paid to influence the outcome of the election. Another big spender was J.P. Morgan, which served up $8.8 million in lobbying and another $784,923 to influence the election.

This increased lobbying activity unfortunately goes on outside public view. Only later can we tally up the damage from this legalized corruption of our democracy – and our pocketbooks.

And when lobbyists win, so do the corporations that pay them big bucks.

I wrote earlier this month about the corporate goodies hidden away in the fiscal cliff deal that represented just a part of the lobbyists’ handiwork – a down payment from members of Congress on their debt to the corporations who foot the bill for their campaigns and other political adventures.

Because there was no grand bargain, Congress couldn’t go all the way on their corporate overlords’ agenda, such as implementing the Social Security and Medicare cuts the CEOs have been hammering away at.

One of the most recent glaring examples of how our government does corporate bidding in secret, contrary to the public good, is the recent favor Congress did for biotech and pharmaceutical giant Amgen, hidden in the fiscal cliff deal.

As revealed by investigative reporters for the New York Times, Amgen received a very profitable gift in that deal – an exemption from Medicare price controls for one its kidney dialysis drugs. It’s the second such exemption Amgen obtained for the drug, Sensipar, which accounted for $950 million in sales last year, an 18 percent increase over the previous year.

So the $7.6 million the company paid for lobbying, and another $1.7 million in political contributions the company showered on both parties, was a small price to pay the government to keep its mitts off the company’s hot property.

At the center of the fiscal cliff deal were two senators, one Democrat, Max Baucus, and one Republican, Mitch McConnell, who are prime recipients of Amgen’s generosity. Since 2007, Amgen has given Baucus $67,500 and McConnell $73,000.

Amgen has also donated $141,000 to President Obama, who signed off on the fiscal cliff deal.

Congress’ secret favor for Amgem is expected to cost Medicare $500 million.

In December, before the fiscal cliff deal was set, President Obama was stressing the importance of reducing Medicare costs.

“I’m willing to reduce our government’s Medicare bills by finding new ways to reduce the cost of healthcare in this country," Obama said. "That's something that we all should agree on. We want to make sure that Medicare is there for future generations. But the current trajectory of health care costs is going up so high we've got to find ways to make sure that it’s sustainable."

The Amgen exemption also highlights the revolving door nature of business in Washington; current lobbyists for Amgen include former chiefs of staff for Baucus and McConnell.

A Vermont congressman has introduced legislation to undo Amgen’s sweet deal. Rep. Peter Welch, a Democrat, told the Los Angeles Times: “Amgen managed to get a $500-million paragraph in the fiscal-cliff bill and virtually no one in Congress was aware of it. It’s a taxpayer ripoff and comes at a really bad time when we’re trying to control healthcare costs. Amgen should not be allowed to turn Medicare into a profit center.”

Call your representative and senator and let them know how you feel about major corporations like Amgen getting secret favors behind closed doors.

Homeowners' rights face tough fight

California’s bankers have decided that the state’s homeowners don’t need any bill of rights after all, and state legislators show signs of going along with the banks.

In February, California’s attorney general, Kamala Harris, garnered publicity for packaging several modest foreclosure reform measures together as a homeowners’ bill of rights.

Harris was attempting to get state legislators to permanently outlaw several of the most noxious of the banks’ practices during the foreclosure process, which about a half a million Californians now face.

Among the measures was one that would have outlawed the widespread practice of “double-tracking,” in which banks foreclose on homeowners while they are in the process of working out loan modifications. Another measure would have banned the widespread practice of “robo-signing,” in which the bankers hired low-level employees to sign off on stacks of key foreclosure documents without reading them or verifying their accuracy – a practice which the big bankers have supposedly already agreed to stop as part of a 49-state settlement of foreclosure fraud charges against the biggest banks.

But the settlement apparently only requires the biggest bankers to quit their robo-signing ways for three years; Harris’ proposal would make the ban on robo-signing permanent and apply it to other financial institutions not covered by the settlement.

Other parts of the “bill of rights” package would have imposed a $25 fee on banks when they file a default and required banks to establish a single point of contact for homeowners seeking a loan modification.

Harris, a close ally of President Obama, has even been touted as a possible choice for a U.S. Supreme Court. But she’s been overmatched by the combined forces of the California Bankers’ Association and the California Chamber of Commerce, which has labeled some parts of the package “job killers.” They’ve also spread a lot of cash around the legislature over the past 5 years, more than $33 million, so they’ve got legislators pretty well trained.

It would hardly be the first time that California’s legislators have balked at enacting sensible measures to protect homeowners, as well as taxpayers, from bearing the costs of bankers’ misdeeds during the state’s foreclosure crisis. In recent years, legislators also failed to enact proposals that would have required bankers to mediate with homeowners before foreclosure, and another that would have required banks to post a $20,000 for each foreclosure they file, to cover the costs to communities of abandoned, bank-owned property.

Harris was scheduled to testify before a legislative committee on the bills earlier this week when the head of the committee, Assemblyman Mike Eng, a Democrat, withdrew the bills.

The Sacramento Bee reports that the legislation is now headed for a conference committee made up of legislators from the state Assembly and Senate.

According to the Bee, this is a maneuver to get a vote on the legislation without having to go through Eng’s committee, Assembly Banking and Finance, which is apparently split on it.

If you live in California, now would be a good time to call your legislator and remind them that they don’t work for the bankers and the chamber. They work for you.

Action / California Attorney General Kamala Harris / Foreclosures / Martin Column - 04/19/2012

Fight Back Against Citizens United

On the second anniversary of Citizens United, the U.S. Supreme Court ruling that corporations are people, there’s bad news and good news.

The bad news: we’re seeing the full impact of the ruling, with the creation of PACs --- political action committees -- with innocuous Mom and apple pie-sounding names, like Make Us Great Again and Winning Our Future, funded by unlimited anonymous corporate contributions.

The good news is that the ruling has galvanized a grassroots backlash: if you’re mad as hell and want to join the fight to rid our democracy of toxic big money, there’s an explosion of grassroots opposition for you to plug into today, or whenever you’re ready.

First, a little history. Corporate political contributions have been stirring outrage for more than 100 years, since they helped elect Teddy Roosevelt in 1904. Once elected, the savvy Roosevelt got in front of a movement to outlaw those contributions, resulting in passage of the Tillman Act.

But the corporations didn’t just slink away in defeat; they developed ever more creative ways to skirt the law and influence elections.

In Citizens United, eight Supreme Court justices ruled in 2010 that while corporations couldn’t contribute to individual candidates they could give to political action committees that do not, supposedly, have formal ties to a particular candidate.

In their ruling, the justices took a flawed, too narrow view of the way in which money corrupts politics. First, they said that since the PACs aren’t linked to individual candidates, the contributions couldn’t be used to bribe the candidates, or extract a quid pro quo.

The court ignored the well-known fact that the monster PACs do establish informal but strong ties to individual candidates.

In addition, the court misstates the more insidious way massive corporate cash corrupts our government. As Harvard professor Lawrence Lessig points out, large corporate contributions ensure that only those candidates, regardless of party, who can collect those contributions, and espouse a corporate-friendly political agenda, stand any chance.

This creates a political system that thwarts goals of left and right.

If we don’t reverse Citizens United and confront corporate power, we can expect more corporate bailouts with no questions asked, and fewer consumer, environmental, employee and investor protections. We can expect more tax breaks for the 1 percent and more austerity for the 99 percent.

At WheresOurMoney, my colleague Harvey Rosenfield has proposed a constitutional amendment to overturn Citizens United that is easily understood and will withstand any legal challenge. You can read more about it here. There’s a great video with background and ideas about fighting Citizens United here.

You can find groups taking a variety of actions against Citizens United across the country here and here.

Action / Citizens United / Martin Column - 01/21/2012

9 For the 99 – Restoring the Real Economy

Remember how aggressively our leaders have talked about tackling unemployment and the housing crisis?

Remember all the strong action to make good on their promises?

Me neither.

Remember how all our leaders criticized each other for taking money from Wall Street and other powerful corporate interests?

Remember all the potent steps they took to rid our democracy of corporate money?

Me neither.

You’ve probably heard of Herman Cain’s 9-9-9-tax plan, the scheme he says will get the economy going. Do you think it will work?

Here’s our proposal to restore the real economy. Unlike the solutions proposed by our leaders, these proposals focus on the problems faced every day by most people, not bankers.

We’ll be offering it at OccupyLA in the next couple of days to complement their work.

Support 28A, constitutional amendment overturning U.S. Supreme Court “Citizens United” ruling to stop the flood of toxic corporate cash poisoning our democracy
Prosecute Wall Street crime, not Wall Street protestors
Give citizens same right to borrow taxpayer money from the Fed at the same low interest rates that Wall Street got in the bailout
Cap bank fees and interest rates
Offer real foreclosure relief: Require banks to provide principal reduction for underwater mortgages, including allowing judges to reduce home mortgage principal in bankruptcy court to encourage mortgage modifications
Repeal unnecessary tax loopholes and other corporate subsidies (overseas tax breaks, local & state tax bribes for moving jobs from one community to another, make corporations pay taxes) and transfer savings to taxpayers and small businesses in the form of tax cuts.
Repeal corporate-backed NAFTA-style trade deals, which export U.S. jobs overseas, reduce wages of American workers to that of laborers in foreign countries and weaken environmental regulation.
Restore traditional separations between federally guaranteed consumer banking from other, riskier, financial business.
Reform student debt, stop predatory practices.

For more information, check out http://www.wheresourmoney.org

On Facebook https://www.facebook.com/wheresourmoney

Twitter http://twitter.com/ - !/WheresOurMoney

Support 28A http://www.wheresourmoney.org/campaign-2011/

Action / Citizens United / Congress / Foreclosure / Martin Column / Supreme Court - 10/20/2011

Going to the White House

I've been a politics geek since I was about 10 years old and I went from reading the sports page of the Detroit News to the front page. I've been reading about it, arguing about it, covering it on some level as a journalist, and some times writing about it as an advocate, ever since.
So getting invited to the White House as part of a delegation of California activists, organizers and bloggers, organized by the Courage Campaign, is a big deal. A lot of us have expressed frustration with the Obama administration for it’s unwillingness to focus on jobs and housing in a more effective way, for its embrace of the austerity agenda, and its failure to hold bankers accountable in any meaningful way for the financial collapse that the whole country is still suffering from.
I was ambivalent about going at first, because this administration has sometimes seemed so determined not to get to it, to prize elusive bipartisanship over a strong fight for what’s right, for its cluelessness about the depth of the unemployment and housing crisis that continues to cause so much misery across the country.
That cluelessness was on display again in the past few days, when the president proclaimed no deficit deal would be fair without “shared sacrifice” that would require hedge fund managers to pay higher taxes while the government cut Medicaid. Does the president really believe that the sacrifice is equivalent – millionaires having to get by on a little less while people who are dependent on the government for health care get less care?
Even in planning our visit, the White House doesn’t seem to get it. We’ll have break-out sessions on education reform, the new health care law, lesbian gay transgender bisexual issues, the environment and labor – but no session on the foreclosure crisis and housing. The administration’s efforts in this area, so crucial to California’s economy, have been particularly lame. Whether or not the president’s staff wants to focus on it, I’m sure they will get an earful.
What I will suggest to the president’s people is that he’s vulnerable because he hasn’t done enough to reduce unemployment or to address the foreclosure crisis, and because too often he has accepted the Radical Republicans’ and the deficit hawks’ terms of the debate. When the president debates on those terms, he loses. We all lose.
Still, I don’t want to give up on the administration or the people who continue to put their faith in him. I’ll go in memory of my father, Irving Berg, who would be 90 this year. He saw great promise in Obama and wouldn’t allow frustration to cause me to give up on him, or fail to participate in some effort that might set Obama on a firmer course.
We meet with the president’s top staff on Friday all day. Any messages you want me to deliver?

Action / D.C. Disconnect / Foreclosures / Martin Column / Outrage / President Barack Obama - 09/22/2011

"Wall Street Is Our Main Street" NOT

New York's Attorney General is under pressure from banks and, sadly, the federal government, to agree to a sweetheart settlement that will let the financial industry off the hook for its mishandling of mortgages and foreclosures, today's New York Times reports.

As my colleague Marty Berg has reported, the settlement, negotiated by other state Attorney Generals, is a disaster for consumers who got screwed by the financial industry that taxpayers had to spend hundreds of billions to bail out three years ago. Most of the banks are doing great now, while many Americans are barely hanging on by their fingernails.

The Obama Administration - from the Justice Department to the Department of Housing and Urban Development – is pushing NY AG Eric Schneiderman to agree to an $20 billion settlement that would actually prevent people from further litigation against Bank of America, Citigroup, JPMorgan Chase and Wells Fargo. It's been widely criticized as a sell-out. Schneiderman's also pissed off Wall Street for trying to scuttle another settlement that would have shortchanged investors.

A member of the Federal Reserve Bank of New York told the Times "Wall Street is our Main Street... we have to make sure we are doing everything we can to support them," that is, of course, "unless they are doing something indefensible." Yeah, right.

There haven't been many heroes over the last few years willing to take on Wall Street on behalf of the silent majority of Americans who can't make campaign contributions. The New York AG is one, and he deserves to know we appreciate his efforts. If you agree, email his people: NYAG.Pressoffice@oag.state.ny.us – or tweet him @AGSchneiderman.

Action / Foreclosures / Harvey Column - 08/22/2011

The 4th of Awry

When I grew up in a suburb south of Boston in the Sixties, the Fourth of July was distinctly the greatest day of summer. Preparations would begin well in advance. First, a trip to Chinatown where we’d pay ten times the fair price for a brick of firecrackers and as many cherry bombs or M-80s as we could afford. The night before, one of our gang’s parents would drive us down to the shore to watch the magnificent fireworks displays, while AM car radios would play patriotic tunes like the Star Spangled Banner. I can still smell the gunpowder that would waft in clouds around us. The next night, we’d conjure up our own smaller version in our backyards, occasionally evading the police when our displays raised the neighbors’ ire.

The times were contentious – the Vietnam War had engendered a national divide – but at the peak of our youth the future seemed limitless. We were about to land a man on the moon! The red glare of the Saturn V rocket as it heaved its gargantuan frame into space symbolized to us kids all that was great about America. Freedom was such a powerful force that it could break the bonds of gravity. As a nation, we would not be restrained.

That all seems like dim myth now. Savaged by the financial collapse and the cost of endless wars on the other side of our planet, there is no budget for fireworks here in Southern California, though some towns have lifted the ban on private sales of firecrackers to grab a little extra tax revenue. Our dreams of pressing the boundaries of space have likewise been downsized. Next Friday, the space shuttle will make its last journey, and “after that, there is little glory to look forward to,” the New York Times notes this morning. The universe has receded from our grasp.

Something has gone profoundly awry in America. Our Supreme Court has defined freedom to mean the ability of big corporations to spend unlimited amounts of money in behalf of their private political agendas, while the rest of us wield our personal freedom in obscurity and servitude. Awash in money from the powerful and wealthy, our elected officials have abandoned the majority of us. We are left to contend with rising health insurance premiums, disappearing jobs, $4.00 a gallon gasoline, a collapse of social services, and the deeply disturbing prospect that we are leaving our kids with fewer options and worse prospects than we enjoyed.

And fear has set in. Around a third or more of all Americans now fear for the basics: their ability to start a family, buy a home, put their kids through college, and retire. Through the tyranny of greed, we have lost our liberty to make a better future for ourselves. We have been robbed not merely of our savings, but of our personal and national sense of possibility.

We can recover these – we must. But we cannot do so alone. We can no longer hope to be led. We must, ourselves, lead.

Action / Harvey Column - 07/04/2011

Get Off Corporate Crack

I spent last week at the Netroots Nation conference in Minneapolis, a gathering of activists who embrace the progressive label in one way or another.

The news media was there in force, churning out stories about how these progressives are dissatisfied with President Obama’s performance. That’s especially true in his handling of the economy, where unemployment is still too high, the foreclosure crisis is still rampant, the financial sector still hasn’t been adequately reformed after its excesses and Wall Street lobbyists have tangled up in knots even the meager attempts to regulate bankers.

One refrain summed up the frustration with the president’s performance on the economy: “No one has gone to jail.”

But beyond the venting that the media focused on was another, potentially bigger story that has the possibility of leapfrogging the divide between left and right.

That was the emerging demand for a mass movement to rid our politics of the corporate funding that has been as devastating as crack cocaine was in the streets.

Our politicians are hooked on corporate crack, and they will do anything and say anything to get it. They will break any promise, without caring how foolish and hypocritical they look.

This corporate money undermines both parties: Democrats promise to protect workers and consumers but end up promoting ineffective half-measures, while Republicans express support for the free market but actually support the unfettered power of a corporate oligarchy.

I had the opportunity to point out a recent example of how this corporate crack makes fools out of politicians and even the president of the United States during a Netroots session with Jeremy Bird, national strategy adviser to the Obama campaign.

I recounted how one day after reading about a secret meeting between Obama and his Wall Street donors at the White House, I received an email from Obama asking for five bucks, promising a different kind of fundraising campaign that didn’t rely on fat cats.

“Which is it?” I asked Bird. You can read Roll Call’s account here.

Bird responded that Obama’s “multi-faceted” fundraising wouldn’t take money from political campaign committees or lobbyists, but Wall Street contributions are welcome.

Does the president really see a distinction, or is he just hoping no one is paying attention?

If the politicians are counting on people feeling too cynical and helpless to take action, that may be changing, sparked by the U.S. Supreme Court ruling in Citizens’ United, which said that corporate campaign contributions are a form of free speech so they cannot be restricted.

During another session, John Nichols, the Nation’s crusading Washington correspondent issued a fiery call for a nationwide movement to promote a constitutional amendment to undo Citizens’ United.

He compared the potential impact of such a movement to the impact of the movement for a constitutional amendment to ban abortion. Though the “right to life” movement hasn’t achieved success. Nichols said, it has changed the nature of the debate.
Back on the subject of overturning Citizens’ United, Nichols said, “I can live without the actual constitutional amendment. But I can’t live without the movement.”

We need a movement that labels corporate crack exactly what it is. It’s not speech. It’s bribery.

Action / Around the Web / Congress / Financial Reform Legislation / Martin Column / Outrage / President Barack Obama - 06/22/2011

Listening to Our History

Driving through the west, headed towards home from a cross-country road trip with my wife Stacie and dog Billie, there's endless hours on the highway, no Internet and not much radio except for hard-right talk.

Hearing the voices passing through the desert states is a grim reminder of the forces we're up against, who now characterize themselves as the real "community organizers," who represent the real people.

It’s not just the right wing. Lots of people have adopted the timid trickle-down theories embodied by our political leadership: "Don't get too tough on BP or they’ll take away our jobs. Don't cross Wall Street, we need to keep the market stable."

We’re in Winslow, Arizona, wondering whether a boycott will worsen the dire poverty we see in front of us. It’s easier and more politically expedient to make immigrants the scapegoats for lack of jobs and economic uncertainty than it is to question a system that is seriously out of whack, that offers the biggest rewards to those who gamble on our collective losses without risking their own wealth.

That's what a big chunk of the financial system like hedge funds and derivatives has become. Cynical and bloodthirsty, producing nothing except profits for the few. And the gesture toward financial reform winding its way through congressional conference committee does little to change that.

I understand the fears of friends and family that the money they have saved and invested over the years will be lost if we challenge Wall Street and the robber barons of our time. The financial industry has shown that if it doesn’t get what it wants it is capable of wrecking our economy and causing great suffering for others. But this kind of blackmail undermines democracy. We deserve a financial system that provides both transparency and financial security.

Traveling through the country, along roads adjacent to rail lines and mile-long freight trains, I kept thinking about our nation's history and those rare moments of courageous leadership like Teddy Roosevelt tackling the railroad trusts, and FDR and his team creating the New Deal to save the financial system from its own excesses. And the creation of the GI Bill, which was designed to bolster possibilities for people who risked their lives for our country, and had played a huge part in the creation of a vital middle class. These were moments when audacious politics met pragmatic problem-solving.

I attended the Personal Democracy Forum in New York City earlier this month. The topic of the wide-ranging conference was “Can the Internet Save Politics?”

One of the most inspiring speakers was Daniel Ellsberg. Amid all the excitement over the possibilities for political activism and engagement with new social media, Ellsberg reminded us that one of the most important ingredients is the same as it always was: moral courage.

Ellsberg was the Pentagon military analyst who leaked a secret Defense Department account of the disgraceful political decisions that led the country into the Vietnam War and its outcome. Plenty of people on the inside knew what was happening in Vietnam, Ellsberg said, but they had kids to put through college and mortgages to pay. They were not about to step outside the system and jeopardize their careers.

Not everybody has the nerve or inside information to be a whistleblower like Ellsberg. But we can demand a financial and economic system where we don’t have to sacrifice our financial security to those who gamble against our futures.

We can demand that our president delivers on his campaign promise of real change. There can be no real change without confronting corporate power over our government and political system. We are as controlled today by the financial and oil industries as we were by the railroad barons when Teddy Roosevelt took them on. TR said one should speak softly and carry a big stick. President Obama has been doing the opposite. We need to demand that Barack Obama follow TR’s suggestion.

Action / Martin Column / President Barack Obama - 06/20/2010

Consumer Protection, Fed Style

One of the big unsettled issues for the congressional conference committee considering financial reform is whether to create an independent financial consumer protection agency.

That’s what the House bill does. The argument for an independent agency is that consumers need a strong advocate in the financial marketplace.

The Senate decided that an independent consumer financial watchdog wasn’t needed, and that the consumer financial protector should live in, of all places, the Federal Reserve. After all, the Fed already has responsibilities to “implement major laws concerning consumer credit.” We all know how well that worked out.

The problem is that the Fed has functioned as a protector of the big banks, never more so than since the big bank bailout and in the battle over financial reform.

Despite promises for greater transparency, the Fed has repeatedly resisted attempts to get it to disclose all the favors it’s done for financial institutions since the bailout. If the Fed had put up half the fight against bank secrecy that it’s waged on behalf of bank secrets, consumers would never have been subjected to all those lousy subprime loans.

It is telling that no actual consumers or consumer organizations actually think that housing consumer protection inside the Fed is a good idea. Who does? The big banks and the Fed.

For those who still need convincing that a Fed-housed consumer protection agency is a bad idea, the Fed has provided a more recent example of what it means by consumer protection.

Last month it unveiled a database that’s supposed to help people choose the most appropriate credit card.

The database might be useful to professional researchers but provides little that would be of use to ordinary consumers. It presents the credit card statements by company but provides no other search functions, such as comparing credit cards by interest rates or fees.

Some of the presentation suggests that the information was dumped onto the Fed’s website without much thought. Bill Allison, who is editorial director of the Sunlight Foundation, a non-profit organization that digitizes government data and creates online tools to make it accessible to readers, said the following:

“I don't think there's anything wrong with posting it, but this is obviously not data you can search,” Allison told Bailout Sleuth.

He also pointed out that some of the agreements themselves aren't particularly informative. He cited the entry for Barclays Bank Delaware, which notes that the bank may assess fees for late payments and returned checks. “The current amounts of such Account Fees are stated in the Supplement,” the agreement reads.

But that supplement is not contained in the Fed's database. The Fed promises to go back and refine its database. But if they’re not devoting the resources to get this right now, with their ability to protect consumers under the microscope, do you really expect they’ll do better later?

An independent consumer protector is not simply some technicality to be bargained away. We’ve learned from the bubble and its aftermath that consumers need all the help they can get. Contact your congressperson and tell them you’re still paying attention to the reform fight. Check out your congressperson and see if they’re on the conference committee. If they are, your voice is especially important. While you’re at it, contact the president and remind him we won’t settle for any more watering down of financial reform.

Action / Federal Reserve / Financial Reform Legislation / Martin Column - 06/02/2010