Wednesday, May 19, 2021

As If We Needed Another Reason to Hate Bankers

Just when you thought they couldn't sink any lower, the rentier capitalist class has burrowed down into the deepest slimy depths of shameless greed.

These ideological progeny of the slave trade are complaining that if the Black farmers trapped in debt peonage are freed by the federal government to the tune of $4 billion, with the predatory loans paid off early and in full, it wouldn't be fair to the investors in the "secondary market" who were counting on earning interest on compound interest on compound interest until either the death of the debtors and all their heirs. or until hell freezes over.

And if the federal government still insists, despite all the ravenous ongoing lobbying by banking groups, on paying back the Black farmers' loans early, the bankers proceed to demand that they and the investors in these loans should also be handsomely compensated for future paper losses. 

I suppose you can't really blame the rentiers of finance capital, given that heretofore the feds had so reliably bailed out Wall Street while shafting Main Street. It was just a little more than decade ago, for instance, that the Obama administration had rewarded the miscreants of the subprime mortgage industry and house-stealing private equity firms while allowing millions of ordinary people to lose the roofs over their heads. The Trump administration later sweetened the pot even more by lowering corporate tax rates and using the pandemic to open up the spigots of the Federal Reserve to the already-rich to the tune of trillions of dollars.

The predatory financial class simply doesn't understand why the Biden administration is allowing mere mortals, like Black farmers, to partake of even the crumbs left over from the feast.  Not that the debt peons have yet received one single crumb, mind you, because the funds approved in March as part of the $1.9 trillion rescue package are still stuck in bureaucratic limbo, along with the billions approved by Congress for rent relief.

As the New York Times reports:

Bank lobbyists, in letters and virtual meetings, have been asking the Agriculture Department to make changes to the repayment program, a U.S.D.A. official said. They are pressing the U.S.D.A. to simply make the loan payments, rather than wipe out the debt all at once. And they are warning of other repercussions, including long-term damage to the U.S.D.A.’s minority lending program.

In a letter sent last month to Tom Vilsack, the agriculture secretary, the banks suggested that they might be more reluctant to extend credit if the loans were quickly repaid, leaving minority farmers worse off in the long run. The intimation was viewed as a threat by some organizations that represent Black farmers.

“If U.S.D.A. does not compensate lenders for such disruptions or avoid sudden loan payoffs, the likely result will be less access to credit for those seeking U.S.D.A. guaranteed loans in the future, including U.S.D.A. farmers/ranchers,” they (the bankers) wrote to Mr. Vilsack in April.

If this sounds like attempted extortion, it's because it is attempted extortion.

But because the de facto oligarchy that rules these United States could never survive in our putative representative democracy without also engaging in some good old co-optation and Divide and Conquer mayhem, a different group purporting to represent white ranchers and farmers is also suing the USDA, on grounds that the federal bailout is racially discriminatory. It's called America First Legal, and it's led by Stephen Miller, late of the Trump administration.

As for USDA Secretary Vilsack, his reappointment to the post in the Biden administration elicited a flurry of complaints from civil rights leaders and Black farmers themselves for the backlog of discrimination complaints he'd allowed to accumulate during his eight years under Obama, as well as his misrepresentation of data to cover up the numbers of Black farmers who'd been losing their land for decades because of discrimination by banks.

Whether he now bows to pressure from the banking lobby and delays disbursement of funds just as planting season begins remains to be seen. But he already has a history of crumbling to right wing pressure.

In 2017, he became the only Obama cabinet member to support the confirmation of Trump's own agriculture secretary, Sonny Perdue - who among his other claims to fame, moved to kick hundreds of thousands of people off their SNAP (food stamp) benefits unless they got jobs.

In 2010, a doctored video produced by the late notorious right wing provocateur Andrew Breitbart led to Vilsack firing Black USDA regional official Shirley Sherrod without getting her side of the story or demanding to see her full recorded remarks. Once Sherrod was vindicated, Vilsack merely offered her a different post, one which she refused. She was among the chorus of critics who expressed dismay at Vilsack's reappointment as ag secretary by Biden. 

That's the history that gives the predatory banking industry so much hope for a lot more federal change in their own pockets as their reward for continuing to profit off the pain and deprivation of others.


Mark Thomason said...

I don't hate bankers for this.

I hate those who write the laws so as to allow this.

In the same way I don't hate predatory lenders, I hate those who eliminated usury laws and make the courts enforce predator interest rates.

It is legal. That is the problem. Who made it legal? Not the banks. When they do what the mob once did with the FBI on its heels, but the courts backing them up, it is those who write those laws that I hate. And it seems we vote for them.

Jay–Ottawa said...

To read about and react to these large-scale injustices by one US administration after another is to move inside any painting by Goya, or Picasso's Guernica. Of course attentive onlookers don't have it as bad as the indebted black farmers, the victims of Goya's day or the town under Nazi bombs, but, if you don't blink, you hear the screams up close, unceasingly, just as loud as the scream of that wounded horse in Picasso's depiction of slaughter. That horse still provides a coda for the symphony of corruption that fills the air around us.

Yes, as noted above, the laws themselves make theft and the impoverishment of others legal. How do the technicians who slipped into those laws the right phrases at the drafting sleep at night? And now, those banking clerks composing letters beseeching corrupt ministers to screw the poor yet again, how do they sleep?

Instead of signing petitions, calling a rep's office or writing a letter to make a pitch for fairness in some cause, maybe we should begin sending our leaders pictures of famous paintings depicting injustice, grand larceny and murder. In this case, merely write on the reverse "Free Indebted Black Farmers." At least one low-level staffer will pause to look before tossing it in the waste basket of constituent opinion.

Jay–Ottawa said...

Here's a quote within a top comment (Jim) following a lead story ("Israel's Military Inflicted") in today's digital Times:

"It’s mind-boggling to me that anyone in Israel, or anywhere, thinks that having an impoverished, besieged, angry, young, traumatized, starved population in Gaza is somehow in anyone’s interest, or could in any way produce stability or safety for anyone," said Khaled Elgindy, a senior fellow at the Middle East Institute. “It just means it’ll happen all over again."

Erik Roth said...

By careful attention and clear intention, our “founding fathers” (all white males) established a republic, a so-called representative democracy.
But Congress, which writes our laws, is wholly owned by Wall Street. So it is the plutocrats who are represented.

"Capitalism is the extraordinary belief that the nastiest of men for the nastiest of motives will somehow work for the benefit of all."
~ John Maynard Keynes

"When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes. Money has no motherland; financiers are without patriotism and without decency; their sole object is gain”
~ Napolean Bonaparte

"Who controls the food supply controls the people;
who controls energy controls whole continents;
who controls money controls the world."
~ Henry Kissinger

“Scared money can’t win and a worried man can’t love.”
~ Cormac McCarthy, "All the Pretty Horses"

Leila said...

Tell 'em Joe's Spiritual Advisor relayed a message from God declaring this a Jubilee. They're OK with God doin' that, yes?

Jay–Ottawa said...

Something like the Jubilee's been going strong since 2008. You know, the Fed's continued eating of billions in bad paper (from Wall Street) while disgorging QE in billions (for Wall Street).

But I wonder whether the Fed got its scripture mixed up. A Jubilee year is supposed to come around once every 49 years. The Fed is acting as though a Jubilee goes on and on for 49 years. For Wall Street. According to the Fed's latest interpretation, till 2057.

Hang on. During such a bonanza there's sure to be trickle down along the way. People, what else can you call $1,200, then $600, then $1,400?

Jay–Ottawa said...

Around 8AM this morning another item of "breaking news" from the NYT: Biden is about to propose a $6 trillion budget.

Q. At what point does PAYGO kick in? You know, the implacable law: revenue in must first be obtained –– from somewhere –– before revenue can go out in a new direction. Since the super rich and the Wall Street gamblers have not been taxed an extra cent since Biden took office, where's the new money coming from to cover that $6T? Can't be from the Pentagon budget; Biden wants to up that higher than Trump.

A. Listen closely. Biden will get the $6T the same place the Fed got trillions when recapitalizing Wall Street and dancing the QE shuffle night after night month after month: they print it. What could go wrong?

You see, the PAYGO rule that applies when common citizens are in need does not apply for one reason or another when the right people say forget PAYGO. Krugman is sure to explain in a future column.

Love those bankers. They pioneered the tricky road around PAYGO.

valerielongtweedie said...

Excellent essay, Karen. I had no idea this was going on.