JPM would pay $13 billion in penalties that follow from the bank’s shady mortgage lending, which helped to precipitate the financial crisis and make the lives of tens of millions of people completely miserable. It would be the largest fine that a company has ever paid in a settlement with DOJ, but surely doesn’t go far enough.
Rhode Island was, of course, hit disproportionately hard by the financial crisis and the mortgage fraud that fomented it. You might think that this would make local pols want to steer clear of association with the people and corporations who did all that terrible stuff to the Rhode Island electorate — but then you’d be wrong.
If politicians are expected to return funds taken years ago from an insurance fraudster who cost his victims a few tens of millions of dollars, then shouldn’t the same standard certainly apply to money from bankers who’ve helped cost the American economy several trillion dollars over the last 5-6 years?
So let’s call the question: How many JP Morgan execs has General Treasurer and Wall Street acolyte Gina Raimondo taken money from since she became State Treasurer? Well, I don’t know! Because I spent an hour or so counting them yesterday afternoon and then had to get back to doing some real work. (Namely, this book salon over at firedoglake about that book I wrote/edited about the SOPA fight.) Somebody should keep on looking, or maybe I’ll find more time to later. Just go over here and search the filings for the word “morgan”.
But here’s a partial list of what I dug up during a skim of just a few of her most recent campaign finance filings. These are not bank tellers, mind you: Bank tellers are fine people. These are not fine people: These are the people who lead/led the company that’s on the verge of having the biggest settlement ever with the DOJ, because they engaged in rampant mortgage fraud and helped destroy our economy and the livelihoods of tens of millions of people. Disproportionately in Rhode Island.
And they love Gina Raimondo and are bankrolling her political career!
-Jill Bickstein, Managing Director for Corporate Responsibility (sic)
-Cheryl Black, Managing Director
-Kelly Coffey, head of Diversified Industries Investment Banking
-Martha Gallo, Chief Compliance Office
-Eric Gioia, Vice President of J.P Morgan Chase’s private bank
-Karen Keough, chief state lobbyist
-E John Rosenwald, Vice Chairman Emeritus
-Peter Scher, Head of Corporate Responsibility (sic)
-Emily Seizer, Vice President for international affairs
-Richard Smith, Vice President
Reporters should consider asking if Raimondo will give back the money that she took from these people and their associates. (Really, somebody please at least tweet the question at her a few times. I don’t think she’ll respond to me.)
]]>Prior to becoming the foremost proponent of the undermining of retirement security for American seniors, Peterson founded a private equity firm and was Treasury Secretary. He’s now one of the 150 wealthiest Americans!
FTD ventured out into the Twitterverse this week, and received the greeting it deserves — an old fashioned trolling, in what’s surely unusual fashion for a gentleman of such rarified standing.
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As Politifact writes: All three downgrades occurred about two months after Taveras took the oath of office — and only after a committee of financial experts empaneled by Taveras found and disclosed that the city had a $110-million structural deficit. (A structural deficit is a built-in long-term gap between revenue and expenses.)
The structural deficit, equal to one-sixth the size of the budget and aggravated by a depleted rainy day fund, was inherited from Taveras’ predecessor, David N. Cicilline. In his final months in office, as he was campaigning for his current seat in Congress, Cicilline declared that the city was in “excellent financial condition” — an assessment that he apologized for after winning his new political office.
Thick in cynicism but bereft of wit, ALP and Raimondo are devious enough to warp the truth but too dense to notice the sharp irony at hand: ALP will strive to leverage the bond downgrade deception (and surely many others to come!) into even more campaign funds for Raimondo — who’s spent her tenure as Treasurer paying court to and benefiting from the largess of a shockingly broad swath of the architects of the financial crisis of 2007–tbd. That of course being the very same crisis that helped compel the Providence downgrading that Raimondo’s backers so tactlessly tag onto Taveras.
Raimondo’s supporters insist: “We’re really nice guys.” But would you vote for a gubernatorial candidate whose campaign was backed by hundreds of Joe Mollicones? That’s precisely what they demand.
Under the contemporary economic predicament it is possible for an earnest person to push solemnly for modest pension reforms, lamenting all the while that the detritus of the demolition of our economy rolls downhill to states and cities. Recognizing that so many very wealthy, ever greedy people who run our economy and government wrecked it for the rest of us, even while making it impossible to institute appropriate fiscal policies that might have blunted the impact on the likes of you and me — on our parks, roads, schools, buses, pocketbooks, bellies, and so on. Working people aren’t to blame for the deficits, but cities and (especially small) states only have a few tools in their kits, so: tradeoffs, tough choices, and all that.
That stinks, but fine.
But that’s not at all what Raimondo’s been up to. Rather, she has networked her way into the closed chambers of precisely those same wealthy, greedy people (and is no doubt quite impressed by herself for having pulled off such a feat from her modest perch in a down ballot office in the smallest state).
First, Raimondo convinced Wall Street’s 1% to pay for a secretive propaganda campaign to advocate for deep cuts in the state pension system. Doing so garnered her effusive praise from right-wing stalwarts: from the Wall Street Journal’s editorial page, to the National Review, to Rhode Island’s own tiny Tea Party, which congratulated Raimondo for her “true leadership” as General Treasurer. Then there are the fetes by the likes of ALEC, the Manhattan Institute and the Hedge Fund Industry Awards (for running one of the hedge-fundiest of mid-sized public pensions).
Unfortunately for Rhode Island’s working stiffs, Raimondo’s “true leadership” consisted of slashing benefits even for already-retired seniors on fixed incomes while sending millions of Rhode Island taxpayer dollars to pay the bloated fees demanded by her hedge fund manager friends — for which she’s even been derided in the pages of Forbes Magazine.
Their palates now whetted, Wall Street is lining up to pay for her hoped-for ascent to the state’s highest office. The names that pop out during just a cursory review of the hundreds of people who’ve max-ed out to her still-unannounced gubernatorial run represent a who’s-who of Washington-to-Wall Street revolving door corruption in the extreme.
-Pete Peterson, the billionaire former Chairman and CEO of Lehman Brothers, who now runs the foremost Social Security and Medicare “reform” “think tanks” in Washington, DC, urging the slashing of benefits from these and other programs that are critical for middle class and poorer Rhode Islanders.
-All of the dearest relatives of Robert Rubin, America’s #1 most “Corrupt Capitalist” and the revolving door poster child who oversaw the deregulation of Wall Street during is tenure as Treasury Secretary — between the obligatory stints at Goldman Sachs and Citibank.
-John Arnold, a billionaire Houston-based former Enron energy trader who funds anti-worker campaigns across the country. Read Salon’s recent write-up of Arnold here.
–Securities and Exchange Commission target and former administration official Steve Rattner, another exemplar in extremis of Washington-to-Wall Street revolving door crony capitalist corruption.
Few states have been more harshly impacted than Rhode Island by the of the instantiation of the the will of the global financial elite: from NAFTA’s expediting the decline of the local manufacturing industry, to the outsized local impact of the housing/mortgage crisis and broader economic collapse. If Raimondo’s benefactors get their way, Rhode Island’s relatively aged population will endure the slashing of Social Security, Medicare, and other programs on which they rely; even the modest banking reforms urged by Dodd-Frank will fail to be implemented, and we’ll remain exposed to future cycles boom and (in Rhode Island mostly) bust.
These people and institutions give her money not for concern for the people of Rhode Island, but because under the reign of the Rhode Island proto-Romney, our bright blue state will bleed as the proving grounds for further right-wing financial “innovations”. And because she will serve as a trusted sycophant to Wall Street’s wizard’s should she ever (God forbid) realize her ambition of achieving federal office. Let’s please not let that happen, no matter the deceitful propaganda onslaught that she and her Wall Street backers and the shameful LeadHERship PAC will surely be foisting on Rhode Islanders in months to come.
]]>We lost on a 205-217 vote — while losing Rep. Langevin and several other Democrats, including a handful who’d purport to be progressive.
Demand Progress substantially coordinated these efforts, connecting activists with relevant Hill staff and driving in tens of thousands of constituent calls and emails to Congress over the last few days.
There’s coverage of our work in the Guardian, Huffington Post, Mashable, Vice, The Christian Science Monitor, and many other outlets.
Lots to say about what went down, but it’s worth highlighting the disgusting rhetoric of Dem leadership — accusing all Americans of being potential terrorists in their memo whipping Dems to vote against the amendment. (My emphasis):
Amash/Conyers/Mulvaney/Polis/Massie Amendment – Bars the NSA and other agencies from using Section 215 of the Patriot Act (as codified by Section 501 of FISA) to collect records, including telephone call records, that pertain to persons who may be in communication with terrorist groups but are not already subject to an investigation under Section 215
Meanwhile, the White House issued a (non-ironic) statement decrying the lack of open deliberation about the Amash amendment — which would’ve reined in a system of laws that were built via case law developed in a system of secret courts.
Today’s showing was extraordinary — and while we came up short, we’ve made our point loud and clear, and we’re going to win this fight in not too long.
]]>He’ll be running for Ed Markey’s seat in Congress — once Markey is elected to the Senate later this month. There’s more on Carl’s tenure as a progressive champion in the State House at bottom.
This special event will feature a performance by tenor Joshua Collier and pianist David Sawicki. A special menu prepared by Todd Carranza will include: Spinach watercress roulade, honey roasted carrots, blueberry coconut tart and much, much more.
To purchase tickets online, click here: http://tinyurl.com/oe867od.
Please RSVP by emailing RSVP@CarlForCongress.com. Web: www.CarlForCongress.com Email: Info@CarlForCongress.com
I’ve been friends with Carl since we were both starting out as young elected officials a decade ago and I’ve volunteered on a couple of his (very grassroots-driven) campaigns. He has served in the Massachusetts House of Representatives since 2005, representing neighborhoods in Somerville and Medford.
Carl is one of the few LGBT members of the legislature, after having defeated an anti same-sex marriage incumbent in 2004. He took a leadership role in preserving marriage equality and has passed legislation extending equal rights to transgender residents.
Carl is an active member of the House Progressive Caucus. He has been an advocate for a range of issues related to social and economic justice, including raising the minimum wage, closing corporate tax loopholes, passing Massachusetts landmark universal healthcare law, pushing for improvements in education & testing policies, and increasing access to public transportation.
Carl is an active member of the House Progressive Caucus. He has been an advocate for a range of issues related to social and economic justice, including raising the minimum wage, closing corporate tax loopholes, passing Massachusetts landmark universal healthcare law, pushing for improvements in education & testing policies, and increasing access to public transportation.
Carl has received numerous distinctions for his work including being awarded as the “Best of the New” by Boston Globe Magazine and “Legislator of the Year” by the National Association of Social Workers and the Mass Association of School Psychologists. He is a founding member of the Young Elected Officials Network, serving as State Director for two terms. Prior to being elected to the legislature, Carl worked in the public health field as a research manager at Fenway Community Health Center.
It’d be great to see you this weekend: Let’s get Carl into Congress!
Here’s the rub, from Dave Dayen at Salon:
The vast majority of borrowers 3.4 million will receive $1,000 or less. To pick a category at random, 234,000 borrowers had a loan modification approved, were kicked out of their homes anyway, and will receive for their trouble for having their home effectively stolen a whopping $300 (for comparisons sake, the third-party consultants got $10,000 per review).
HuffPo notes Reed’s role here:
Under questioning from Sen. Jack Reed, a Rhode Island Democrat, regulators came the closest to acknowledging that the reviews, which resulted more than $2 billion in payments by the banks to consultants, were poorly conceived and supervised.
exity of the task,” said Daniel Stipano, a top lawyer at the OCC. He cited the number of financial institutions, consultants and homeowners involved and the difficulty in negotiating state law as among the challenges that reviewers and regulators had to negotiate.
Dave explains how this hearing and the OCC mortgage fraud settlement relate to the broader housing collapse. Dave’s thrilled to see that the foreclosure fraud issue is FINALLY getting some play with the national press — with the tag-team effort by Reed, Warren, and Brown appearing — and even leading — on many national network news casts this week.
I have spent the better part of four years trying, with little success, to raise awareness aboutforeclosure fraud, the largest consumer fraud in the history of the United States. In fact, theres a whole little band of us writers and activists and foreclosure fighters. We have provided multitudes of evidence about fake documents, forged documents, illegal foreclosures, foreclosures on military members while they served overseas, foreclosures on homes with no mortgages, breaking and entering into the wrong homes, suicides by foreclosure victims, and above all the complete lack of accountability for these crimes and abuses.
But instead of giving voice to thousands upon thousands of victims of illegal foreclosures, instead of documenting the banks criminal practices, maybe what we all should have done is simply let the Office of Comptroller of the Currency part of the Treasury Department and the Federal Reserve construct their own settlement with the banks. Then, when it utterly unraveled as it has over the past couple of months the unimaginable fraud heaped upon homeowners would get more attention than ever before, particularly from a frustrated and angry Congress led by Sen. Elizabeth Warren.
The OCC’s pathetic response to the housing crisis, its attempt to cover up its own corruption/ineptitude, and Warren’s star power make this the perfect moment to bear down on these issues. Reed deserves praise for helping to lead the charge — let’s hope he keeps plowing forward.
]]>We are deeply saddened by the passing of Demand Progress’s Aaron Swartz. Friends and family have issued a statement and created a memorial page, here.
Aaron was a dear friend, and an ideological brother in arms. As others have spoken to at great length, he was indeed a passionate advocate for access to information and for a free and open Internet. He believed in these things for their own sakes, but moreover as means towards the even deeper end of building a world defined by social and economic justice. He resisted the impulse to presume that he alone was responsible for his brilliance or should benefit therefrom, and he wasn’t a techno-utopian: He was a communitarian, somebody who was deeply aware of our world’s injustices and who understood the constant struggle that is necessary to even begin to remedy them. That’s why this organization exists.
We’ve worked closely with Aaron over the last two or three years, but have not known him for as long as have some others who’ve written profoundly moving tributes to him and his life’s work. We met him as a genius, but not as the boy-genius that Larry and Cory and many others knew, and we would suggest reading their pieces (below) for deeper insight into his personal and professional evolution. We first encountered Aaron through our executive director’s unsuccessful run for Congress in 2010. Aaron became a fixture in the campaign office, rigging up cheap ways to do polling and robo-calls and helping give the uphill effort a fighting chance. But it was never about just one campaign: He was honing skills and tools he wanted to use to build capacity for much broader social movements that would create fundamental, structural change. He’d taken to calling himself an “applied sociologist.” He was trying to hack the world, and we were happy to help in what small ways we could.
That campaign work quickly transitioned into Demand Progress and Aaron’s conception of the initial petition in opposition to the Combating Online Infringements and Counterfeits Act, and then the ensuing 18 months of activism that helped bring down SOPA and PIPA. There are so many stories to tell about that effort: trudging around the halls of the Capitol, getting under the skin of intransigent senators, generally scrapping away as we struggled to build a movement against all odds. Many of them are best told by Aaron himself, here. But Aaron’s legal troubles began approximately commensurate with the launch of that anti-COICA petition, and it was clear that his persecution by an institutionally corrupted criminal justice system weighed heavily on him throughout the last two years, and certainly more so of late.
We are working with Aaron’s friends, family, and colleagues to determine how best to pay tribute to him — it will surely entail engaging in political activism in service of making this world a more just one. We will be in touch with our members and the general public in the near future to offer suggestions about ways to move forward. Tragically, we’ll have to continue to stifle the visceral impulse to run our half-formed ideas by Aaron, to help us make them better ones.
Click here if you’d like to receive updates from us.
In the meantime, Aaron had deep respect for GiveWell. Those seeking to donate in his name might consider giving to the charities they recommend.
A handful of the myriad tributes to Aaron:
Cory Doctorow
Glenn Greenwald
Lawrence Lessig
Quinn Norton
Their 16th Anniversary Awards Dinner is Thursday at the Cranston Portuguese Club from 6-9pm — it would be great to see all of you there.
You can purchase tickets by clicking here.
RI Jobs with Justice 16th Anniversary Awards Dinner
It’s Rhode Island Jobs with Justice’s sweet 16, and you’re invited to celebrate another year of fighting together for economic and social justice.
Granting corporate incentives has become standard operating procedure for state and local governments across the country. The Times investigation found that the governments collectively give incentives worth at least $80 billion a year.
That’s an especially big deal for cash-strapped states, banned from deficit spending, no printing presses on hand. The $80 billion figure represents a full ten times the budget of my state of Rhode Island, and more than 15 times the amount spent from locally-generated funds.
It’s the most basic of game theory dilemmas, and in a less corrupt political dynamic, one that could be solved by the intervention of sensible federal government actors, or perhaps even through the initiation of an interstate compact that had states agree to stop poaching from one another. (It would still be open season on those states who failed to join said compact, incentivizing their joining the protected bloc.) Rhode Island is rare in that it, at least, has a provision in place that bans its cities from using subsidies to swipe existing businesses from one another — though it’s never enforced. I’d heard (and seem to remember having once found) that Puerto Rico has miraculous language on the books that requires its lawmakers ot consider the impacts of its subsidies on the jurisdictions from which they’re stealing businesses — but perhaps that’s apocryphal.
Good Jobs First has done yeoman’s work to expose the machinations of the “Site Location Consultancy” industry, spearheaded by the maniacal-sounding Fantus companies. (Fantus Factory Locating Service and Fantus Area Research.) Prior to seeing them on paper, I’d always envisioned the spelling as the more malevolent-looking “Phantus” which comports with the shadowy, yet profound, nature of their work.) Felix Fantus got to work in the 1950s, and as GJF describes it:
For the next four decades, Fantus dominated the site location consulting industry, playing a central role in the relocation of thousands of workplaces, most of them factories moving out of the Northeast and Midwest to the South. By its own count, it helped engineer more than 4,000 relocations by the time Yaseen retired in 1977, and 2,000 more in the next decade….
Fantus survives today as a Chicago-based consulting affiliate of the Big Four accounting firm Deloitte & Touche.
A couple of case studies:
Boeing is a master of this manipulative art, flipping the usual government-to-contractor relationship in 2003 as the company put out a 2003 RFP for states to respond to, to see who would offer up the most lucrative package of tax incentives for a manufacturing plant for the 787. Washington State residents bested a couple dozen other states, offering to pay the hometown company $3 billion not to forsake them. (Well, it’s not quite fair to say that they were still deserving of the ‘hometown’ moniker at that point — corporate HQ had moved to Chicago a few years earlier, drawn by a mere $50 million in public funds.) Tragedy became farce in 2009, when South Carolina offered Boeing around $1 billion to open a Dreamliner plant there. Evidence of just how sad is this state of affairs: The WTO is the only body that’s threatened to provide any sort of meaningful check on this sordid dynamic, ruling that several billions of such subsidies to Boeing were problematic — but that European subsidies to Airbus were even more severely infringing.
Perhaps the most transparently absurd manifestation of war-between-the-states phenomenon is the case of the film tax credit, driven by the movie industry’s exploitation of star-struck state legislators who seem to believe that the likes of Boise and Des Moines stand to become the next Hollywood. The film tax credits spurred the most precipitous race to the bottom I’ve witnessed in my time in politics. It came to a head in 2009, when Wisconsin had just spent $100,000 dollars to support Johnny Depp’s personal grooming expenses and Connecticut was fixing to subsidize episodes of Jerry Springer’s talk show — lots of broken chairs to pay for. The capstone of this farce was California’s institution of tax credits to entice productions back to Hollywood. As my friend and former Massachusetts state rep Steve Damico and I wrote at the time:
This sprint to the bottom has just reached its predictable, pathetic conclusion: Burned particularly by the loss of the television show Ugly Betty, California’s recent budget includes a half-billion in tax credits of its own, under the guise of “stimulus,” as a bribe to keep Hollywood from off-shoring to Manhattan, Indianapolis, and Santa Fe, which are offering bribes of their own. The floor has been lowered across the land, achieving a new equilibrium where public subsidies accrue to industry moguls to make movies that would be made anyway. At least 42 states now provide incentives, with some exceeding 40% of production costs.
Even in the seemingly impossible universe in which a particular state seems to benefit from instituting such credits, it’s easy to see that once one abstracts to the regional or national level, all that we’re doing is paying people to move jobs to-and-fro, creating no new social value, and reducing net public benefit.
It’s worth deconstructing the particular form these subsidies tend to take. The terminology “tax credit” is construed to obfuscate the particulars of the mechanism at hand: Most people think it means that there’s a reduction in taxation on expenditures in service of the given project. Far from it, and far worse, here’s how it works: A movie films in State X, and spends $20 million therein. If State X offers a 50% transferable tax credit for film expenditures within its borders, it forks over $10 million thereof. In the case of a state like Rhode Island — or any state that isn’t the production company’s home base — the production company will have a accrued negligible state tax liability, so it will sell these credits to an entity that has a more substantial tax burden — usually a sizable corporation — at a rate of, perhaps, 80 cents on the dollar. A broker will take a cut of perhaps a nickel on the dollar. So the entity that the state was striving to subsidize gets only 75% of the funds the state is expending.
In the case study above the intended recipient of the benefit is an entity that’s achieving little social good (not hard to argue that much Hollywood schlock is, in fact, a social detriment) but even if it’s a worthy project that’s meant to achieve the benefit — say, renewable energy installations — tax credits of this form are always a raw deal for the public, unless a substantial percentage of the credits go unclaimed: A full 25% or so of the subsidy is misfiring, going to middlemen and corporations with significant tax burdens. If you want to fund something efficiently, just fork over cash. (This, of course, could never be made to happen, since then the public would understand that all we’re really doing is forking over cash to millionaires.)
It’s no surprise that tax credit brokers often make for generous campaign contributors. Such a figure is at the center of a still-unfolding scandal in Rhode Island which has been the subject of a fair amount of national reporting: Curt Schilling’s failed video game company 38 Studios, which received a $75 million loan guarantee and various tax credits in exchange for its locating in Rhode Island. The loan guarantee program was sold to us as that rare economic development proposal that seemed mostly sensible: A way to incubate and grow businesses indigenous to Rhode Island in the midst of the downturn, with credit very tight. Yet within a few months, state leaders had designated 60% of the fund for use by the (Republican, anti-tax, anti-welfare) former Red Sox pitcher. The company’s since gone bust, leaving the public on the hook for on the order of $115 million at last check.
It’s a mess, wrought by the usual mix of corrupt cash, a rotten philosophical paradigm, insane, inverted conceptions of capitalism (“States competing against one another is just the free market at work!”) and, especially in the case of the film credits, narcissism: Who doesn’t want a photo opp with Richard Gere?
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