Tuesday, May 8, 2012

Breaking Up with BofA

Chances are that no matter how small your home town is, it contains a Bank of America branch. This heartless financial behemoth has blotted the landscape from sea to shining sea. Your friendly neighborhood bank was there one day, gone the next, in a stealth takeover by one insatiably greedy and lecherous corporate crime family.

Bank of America has a long list of dubious distinctions:

  • #1 forecloser of homes in the US,

  • #1 funder of the US coal industry,

  • Job killer by letting go of nearly 100,000 workers over the past several years,

  • Bonus Buster paying its top five executives over $500 million in bonuses,

  • Saddling students with a lifetime of debt, and

  • Financing the war machine.

  • But there is hope on the horizon. In its never-ending quest to afflict the comfortable and comfort the afflicted, the Occupy movement will be converging on corporate HQ in Charlotte, NC tomorrow for the bank's annual shareholder meeting. Smaller protests are being held at branches throughout the country. For an anti-BofA event near you, check out this site.

    It's painfully obvious that the Obama Administration is never, ever going to clamp down on this monstrosity of a financial institution. The president will even be rubbing our noses in it by giving his DNC acceptance speech at Bank of America stadium this September. Meanwhile, the Justice Department has assigned a measly 55 investigators to pretend to look into the malfeasance of BofA and the other too big to exist financial crime cabals.

    If you have not yet read the seminal takedown of BofA by Matt Taibbi, you can find it here. An excerpt:
    So what does the government do about a rogue firm like this, one that inflates market-wrecking bubbles, commits mass fraud and generally treats the law like its own personal urinal cake? Well, it goes without saying that you rescue that "admitted felon" at all costs – even if you have to spend billions in taxpayer money to do it.

    In fact, the real bailouts of Bank of America didn't even begin until well after TARP. In the years since the crash, the bank has issued more than $44 billion in FDIC-insured debt through a little-known Federal Reserve plan called the Temporary Liquidity Guarantee Program. The plan essentially allows companies whose credit ratings are fucked to borrow against the government's good name – and if the loans aren't paid back, the government is on the hook for all of it. Bank of America has also stayed afloat by constantly borrowing billions in low-­interest emergency loans from the Fed – part of $7.7 trillion in "secret" loans that were not disclosed by the central bank until last year. When the data was finally released, we found out that, on just one day in 2008, Bank of America owed the Fed a staggering $86 billion.
    That means that when you take out a credit card or a mortgage or a refinancing from Bank of America, you're essentially borrowing from the state; the "private" bank is simply taking a cut as a middleman. "For banks, the cost of capital is the key to success," says former New York governor Eliot Spitzer. "So by lowering their cost of capital to almost zero, the Fed has almost guaranteed that the banks will make big profits."
    European governments are actually starting to fall because of the austerity measures imposed on the victims of  global banking rapacity. The Profits over People meme is universal and is being rejected on a worldwide scale. We have, it seems, reached the tipping point.

    Meanwhile, while Bank of America has been the cause of a whole series of unfortunate events, the City of Charlotte has declared its Shareholder Meeting an "extraordinary event" -- meaning that the cabal-coddling government is making sure that bank execs don't get their feelings hurt by irate protesters. Writes Allison Kilkenny of The Nation:

     ....the city plans to restrict free speech and expand the ability of police and security forces to target and profile the homeowners, worker, community members, students and immigrants who plan to demand justice from one of the largest banks in the country.
    The label tightens restrictions on what protesters are allowed to do at such events and gives police more power to search people's property (backpacks, coolers, etc.) in the vicinity. Certain items, such as scarves, are now banned from the event, and the possession of items like markers, hammers and spray paint is now grounds for arrest.
    The extraordinary event tag's origins date back to a city ordinance enacted in January in anticipation of the Democratic National Convention, to be held in Charlotte in September.
    Thus far, it seems like the unprecedented measure adopted by the City Manager has done little to ebb the tide of protester enthusiasm.
    Bank of America obviously thinks it is impervious. Right in the middle of the national uproar over its corrupt practices, it just started sending out letters to homeowners offering financial relief on properties it probably doesn't even own. This is to game the recent terms of the financial settlement with the Attorneys General, reducing the amount of the paltry fine it agreed to pay in lieu of prosecution of its rampant foreclosure fraud. Dave Dayen of Firedoglake has the whole tawdry tale.


    Denis Neville said...

    The Occupy movement will be converging on corporate HQ in Charlotte, NC tomorrow for the bank's annual shareholder meeting.

    And the Charlotte police will be converging on Occupy.

    “To protect Bank of America from inconvenience, Charlotte, North Carolina has directed its police officers to harass and arrest protesters.” Abigail Caplovitz Field on “BofA’s Protection Detail”:

    Deploying state power against citizens for corporate benefit…

    “First Amendment Profiling”– targeting people for looking like protesters.

    Charlotte reassures residents that while they might be stopped and questioned, only protesters would be targeted for punishment.

    “We haven’t yet reached the level of corporatism where preventing inconvenience to BofA can be called a compelling state interest.”

    “We haven’t yet.”


    “united corporations of america” rather than the “United States of America”?

    “Corporate interests” have become so blended with “government interests” the two are now indistinguishable - to our demise.” - Former Republican Congressman Jack Metcalf (WA)

    Denis Neville said...

    The streets belong to the police.

    How will the main(“lame”)stream cover the OWS Bank of America shareholder’s meeting protest in Charlotte tomorrow?

    Tom Engelhardt @ TomDispatch.com, on the May Day protests, asks, “didn’t the great protest movement of our American moment (on a planet still in upheaval) deserve better that day? And no matter what you read in the mainstream, here’s what you would have known nothing about: this country is increasingly an armed camp and those marchers, remarkably relaxed and peaceable, were heading out into a concentration of police that was staggering and should have been startling…”

    “Though Occupy marchers used to chant, “Whose streets, our streets!” it was never so. The streets belong to the police. If this is the democracy and freedom to dissent that American officials constantly proclaim to the world as one of our core values, then pinch me. If most of it is even legal, I’d be surprised. But when it comes to legality, we’re past all that. So any march on a sunny day is instantly imprisoned, and the protesters turned into a captive audience. When young people break out of the barricades and the serried ranks of cops and head in unexpected directions, it has the unmistakable feel of a jailbreak…”

    "Like Bloomberg in the Big Apple, many mayors sent in their paramilitaries (with a helping hand from the Department of Homeland Security) to get rid of the “troublemakers.” Only problem: their real problems run so much deeper and when the next “moment” comes, Occupy could look like a march in the park (which, in many inspirational ways, it largely was). In the meantime, the streets increasingly belong to the weaponized. Americans who protest blur into the “terrorists” who, since 9/11, have been the obsession of what passes for law enforcement.”


    P.S. above is an intro to an excerpt from Noam Chomsky’s new book Occupy.

    Valerie said...

    GREAT post, Karen!

    Yeah, the one that REALLY gets me is that the public has the idea that the bank bailout was a one-time event. The fact that the banks are still borrowing whenever their TERRIBLE bonus grabbing management screws up - takes risks that don't pay off – shows how bad their fiscal management is. Yet, they don't hesitate to cut homeowners off at the knees, charge ridiculous interest rates on credit cards and have all these invisible fees. Talk about corporate welfare!

    Once again, I blame Obama and his banker friendly administration for not getting some decent banking regulation into place. It is what the American people want - at least, all those Americans that can still think - obviously the Fox watching zombies just recite the corporate line.

    Denis Neville said...

    “Why will capitalism always survive?”

    “Because socialism will always be used to save it.”

    Socialism for the rich and capitalism for the poor. Too-big-to-fail corporations get corporate welfare, middle class and poor debtors get austerity.

    There has been a major shift between creditor and borrower rights, the creation of “debtfare,” writes Linda Coco, Debtor’s Prison in the Neoliberal State: “Debtfare”and the Cultural Logics of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005

    “By forcing repayment to lenders both inside and outside the bankruptcy system, BAPCPA mandates a lifestyle of austerity for middle class debtors. Thus, the insidious effect of BAPCPA is the creation of a large group of Americans servicing burdensome debts without any relief.”


    “The reckless gambling behaviors of these firms which tanked the entire economy go unchecked. The creators of the conditions making the failure of the middle class possible were rewarded. Middle class American now face a lifetime of repayment.”

    “While servicing debtfare, the middle class is precluded from the wealth creation process. The cumulative debt load or crushing debt overhang from the interlocking debt structures will absorb the future incomes of consumers and prevent them from engaging in the economy. This will detract from economic growth. Future income used to pay old debts means less money circulating the economy. The flow of money, the life blood of capitalism, is truncated and the velocity of capital slowed. Thus, it becomes apparent that the vision of the drafters of BAPCPA was focused on short term debt collection rather than long term economic health.”

    “Under BAPCPA, the risks and responsibilities traditionally shared by the lender and borrower in the debt relationship are now transferred into the shoulders of the borrower.”

    “For the middle and lower classes, the neoliberal turn has meant job insecurity, lack of unemployment benefits, wage stagnation and decline, decrease of social mobility, workweek extension, lack of healthcare, pension uncertainty, social security insolvency, environmental degradation, and privatization of resources. This change is identified as the “great risk shift.” Over the past three generations, “economic risk has been increasingly shifted from the broad shoulders of government and corporations onto the backs of American workers and their families.” While large investment banking institutions are dubbed “too big to fail,” middle class Americans are failing at ever increasing rates, and every risk and responsibility in the process of disintegration of the social contract is attributed to them.”

    “For lower classes in the U.S., this insecurity, social disorganization, and economic destruction has manifested in a carceral state which increases disciplinary practices and creates “prisonfare.” Increases in police forces, courts, and prisons are the “institutional machinery” and the “symbolic frames” through which neoliberal tenets are being socially imprinted on the lower class populations. Compared to the upper classes, the lower classes experience the opposite visage of neoliberalism: a paternalistic contraction of life chances antithetical to the upper-class liberalization.”

    “Legally mandated debt structures, similar to police and prisons, lock participants into particular life choices and limit future possibilities by requiring their situated participation in unequal and unfree capitalist debt relations. Like the lower classes, the middle classes also experience the opposite visage of neoliberalism: a contraction of life chances antithetical to the upper-class liberalization.”

    Urban Dictionary definition of “class warfare,” - Asking the rich to help the poor and/or pay any taxes at all. Also known as "socialism", "Marxism", and "communism".

    Neil Gillespie said...

    Once Bank of America was in the Too Big To Fail category, what incentive did it have to act responsibly? Same with the other TBTF financial institutions. This situation will continue until enough people demand change, or the financial system crashes.

    "It's painfully obvious that the Obama Administration is never, ever going to clamp down on this monstrosity of a financial institution."

    Obama has a soft spot for banks, and it’s not just all the campaign cash he rakes in from the financial industry. Obama was raised from age 10 by his maternal grandparents. Obama’s maternal grandmother, Madelyn Dunham, was a vice-president of the Bank of Hawaii. During that time Obama attended the Punahou prep school.

    Looking at Obama, his banking background is not readily apparent. But from age 10 Obama was the product of a white, middle-class, Methodist banking family.

    On another topic, Obama revealed his own "dog story" recently, according Janet Davis of the NYT:


    "At the White House Correspondents’ Association dinner last month, President Obama playfully referenced a passage in his memoir in which he told of eating dog meat as a child in Indonesia. Riffing on Sarah Palin’s line — and responding to Republican criticism — he said, "What’s the difference between a hockey mom and a pit bull? A pit bull is delicious." (Of course, Republicans have had their own canine issues, given Mitt Romney’s predilection for fastening his Irish setter to the top of the family car in the 1980s.)"

    This video shows Obama saying pit bull is delicious - with a little soy sauce, and the reaction of wife Michelle.


    At least Romney did not eat his dog.

    Valerie said...

    Excellent comments, @Denis and @Neil - disturbing but thought provoking and informative - thanks