Tag Archives: news

See Americas Biggest Bank Run From Its Responsibilities

By: IFG
April 25, 2012

Hiding behind riot police and scurrying into alleyways, executives from America’s biggest bank, Wells Fargo, entered their April 24 shareholders’ meeting in San Francisco while hundreds of peaceful protesters stood outside demanding accountability and justice. Inside,  several proxy shareholders were arrested as they called to end Wells’ fraudulent foreclosures, tax dodging, predatory lending, profiting from private prisons, and paying-off politicians to rig the rules.

IFG’s Plutonomy Program posits that globalization’s extreme concentrations of wealth and power require people to deal more directly with the individuals at the very top.  So we stood in solidarity with over400 events organized by Occupy, families fighting foreclosure, indebted students, immigrants’ rights groups, and even Wells’ own workers, as they blocked-off several streets in SF’s Financial District.  See this video of a foreclosure fighter sharing her story at IFG’s recent Teach-in on Wells Fargo.

John Stumpf, American banking’s highest-paid CEO who made almost $20M in 2011, called the shareholders’ meeting to order inside while, outside, janitors who clean Wells’ offices told the crowd how profits were squeezed from cutting workers’ healthcare and holding down wages.  But the bank’s record profits in 2011 were driven mainly by mortgages, where Well’s ruthless “Robo-signing” practices continue to foreclose on families, 84% of which in SF were found to be “clear violations of law” by a recent report from the City Attorney.

Warren Buffet, Wells’ single biggest shareholder, owns almost twice as many shares as any other investor.  His legendary investment fund, Berkshire Hathaway, has made him America’s second wealthiest man (after Bill Gates) with a personal net worth of $44B. Buffet has been in the news lately as the namesake of  President Obama’s proposed “Buffett Rule” which would  begin to  reverse years of  regressive taxation in America. Buffett says his secretary now pays taxes on a higher proportion of her income than Buffett himself pays.  That’s because capital gains are now taxed at  only 15% while wages are taxed at almost double the rate. Meanwhile, Wells Fargo avoided ALL taxes from 2008–2010.

The current U.S. tax code’s discrimination against workers’ wages in favor of capital investment has been a driving force of increasing inequality in America, where now almost 1 in 2  Americans is either in poverty, or near poverty.  While Buffett positions himself to champion more progressive tax policies, he is even more powerfully poised—as the most influential shareholder of America’s biggest bank—to reduce record inequality by lowering his expectations on the earnings from his own investments.  Otherwise, shareholder profits made by reducing the healthcare costs of Wells’ janitors could, strangely, shift from Buffet to the Gates Foundation, whose philanthropy aims to “improve healthcare.”  The Buffet Rule would work more effectively if Buffet ruled less ruthlessly by insisting on more realistic returns for his investments.

IFG and allies will continue to call upon  those corporations and individuals who  benefit most from—and are therefore most responsible  for—today’s financial system that is destroying people and the planet.

Read More: Protesting The Wells Fargo Shareholder’s Meeting, 24 Arrested At Wells Fargo ProtestActivists Disrupt Wells Fargo Shareholders Meeting

Will Billionaire Koch Brothers Take Over Cato?

By: Kourosh Behnam
April 25, 2012

Depending on your political views, Charles and David Koch have recently become famous or infamous for their influence, supporting libertarian and conservative causes.

The Cato Institute will soon be owned my the Koch Brothers

Recently the Koch Brothers filed a law suit against the Cato Institute.   Founded by Charles Koch 30 years ago, it is the leading libertarian think tank in Washington D.C.  The Institute primarily promotes limited government, and free markets.  Leading scholars at Cato such as Michael Cannon, director of health policy studies, believe the suit would give the Koch’s full power over the institutions research operations.

The Cato Institute is unique in that it is controlled by shareholders.  There are four people who hold equal shares in the organization. The Koch Brothers hold 2 of those shares meaning that they own half of the organization.  However, ownership of the institute can be bought and sold for cash under certain circumstances.  This is only applicable to a number of states in America which is shunned upon by the Internal Revenue Service.  Charles and David Koch are suing to increase their 50 percent stake in Cato to propel their ideological agenda.  This lawsuit, to gain control of Cato, displays that the brothers see ideological political think tanks as a crucial part of their on-going agenda to create a permanent American oligarchy.

If these billionaire brothers prevail then they will own the biggest libertarian think tank in the world. If this happens, the Cato Institute will loose its reputation in the political realm and it will always be known as a organization coddled by the Koch Brothers.

Read More:  Battle For Control of Cato Institute Highlights Unusual Structure , Open Letter To Charles & David Koch, Could Billionaire Koch Brothers Ruin Cato?

WHY SHUTDOWN WELLS FARGO’S SHAREHOLDERS MEETING

By: IFG
April 17, 2012

Last week, IFG partnered with San Francisco’s community based organizations and local Occupy activists to organize a Teach-in about America’s biggest bank, Wells Fargo, in preparation for their shareholders’ meeting in SF on April 24.

Check out this three-minute video to see why grassroots groups want to shutdown Wells.  The free public event provided a platform for families fighting foreclosure, indebted studentsimmigrants’ rights advocates, private prisons criticsOccupiers, and others impacted by Wells Fargo, to tell their stories.  Participants also heard about how to get involved, including training in non-violent direct action.

IFG’s Plutonomy Program works with grassroots groups to address globalization’s extreme concentrations of wealth and power that are corrupting democracy and destroying the planet through a financial system out of control.   America’s biggest bank deserves everyone’s attention.
See: http://stopwellsfargo.com/en/ for more about the actions around Wells Fargo’s Shareholders meeting
  • Tuesday, April 24, 10:00am
  • Justin Herman Plaza in San Francisco

Methods Of Control Oligarchs Use to Gain Power

By Kourosh Behnam
March 28, 2012

Using the Koch Brothers as a symbol of oligarchic power.

Astroturf Organizations: Bankrolling the radical rights economic agenda has been a tradition in the Koch family for decades. In 1958 Fred Koch was one of the founders of the John Birch Society, an American political advocacy organization that “supports anti-communism, limited government, a Constitutional Republic, and personal freedom.” In 1984 David Koch established Citizens for a Sound Economy, whose sole mission is to fight for less government, lower taxes, and less regulation. However, in 2004 Citizens for a Sound Economy split into two entities: Freedom Works and Americans for Prosperity. The Koch’s remain active in Americans for Prosperity and the individual in charge of FreedomWorks is Dick Armey (Republican Party GOP House majority Leader from 2003 to 2005). The Koch brothers use Americans for Prosperity to stimulate the Tea Party, and AFP organized the first national Tea Party movements in 2009. These organizations have the ability to mobilize, educate, and train people. From Koch donations, American for Prosperity was able to create a $5 million anti-healthcare campaign.

Wealth Defense Industry: A political action committee of Koch Industries, KochPAC (Koch Political Action Committee), has played a tremendous role lobbying in Washington D.C. Lobbyists of Koch Industries have spent much of their time shaping new policy for financial regulation. The Dodd-Frank Act was passed by Congress under the Obama Administration “to craft new rules to subject traders in the energy industry to increased regulation and transparency” according to the Koch Web of Influence by John Farrell. Congress and regulators are still detailing the necessary changes to implement this new law and Koch lobbyists have spent a considerable amount of time shaping the bill. A few weeks, after the bill was passed, Koch lobbyist Gregory Zerzan held a covert meeting with SEC Commissioner Troy Paredes and his counsel, Gena Lai to see how the government would apply the law. According to Greenpeace’s 2011 update report of Koch Industries, the KochPAC spent $2,645,589 in 2009-2010. KochPAC is also the number one oil and gas contributor in the U.S., out spending Exxon Mobil. American oligarchs use many specialized professionals to prevent wealth from being taken, and their wealth defense industry is comprised of lawyers, accountants, wealth management consultants, tax avoidance consultants, and lobbyist. When oligarchs hire them, their main purpose is to defend as much wealth as possible, and only oligarchs would have enough wealth to purchase these services. The industry is global, some of the key players are Whithers, Clifford Chance, Linklaters, White & Case, Milbank Tweed Hadly and McCloy, Weil Gotshal and Manges, and Freeman Freeman and Smiley are known as the “magic circle” firms.

Legislatures and Elected Officials: Mike Morgan, the previous Director of Public and Governmental Affairs of Koch Industries, played a significant role in promoting legislation for the Koch brothers. As of December 2011, Mike Morgan still sits on the Private Enterprise Board of the American Legislative Exchange Council (ALEC). ALEC is an organization that promotes limited government, free markets, and federalism. According to the American Association for Justice “ALEC campaigns have covered many issues, but all have either protected or promoted a corporate revenue stream.” ALEC has proposed legislation that benefits Koch Industries and is undermining climate change proponents. Major campaign contributions from the billionaire brothers can be seen in the makeup of the House Energy and Commerce Committee. Koch Industries is the largest oil and gas donor, giving $279,500 to 22 Republicans on the committee and $32,000 to five of its Democrats, according to the Los Angeles Times. In 2010 KochPAC gave political donations to freshman members of Congress, such as Gardner Cory (R-CO) $10,000, Griffith Morgan (R-VA) $5,000, and Pompeo Mike (R-KS) $10,000.

Courts and Judges: Citizens United v Federal Elections Commission is a landmark case that will go down in history for poisoning our electoral process. This case has allowed corporations to flood our political marketplace and corrupt our democracy and the Koch Brothers themselves played a significant role in enabling this case to advance. Three years ago, Supreme Court Justices Thomas and Scalia attended a political retreat organized by Charles and David Koch in Palm Spring California for wealthy conservatives. There is more speculation that Justice Thomas stayed on a four-day retreat which was paid by the Federalist Society. The Citizens United case that was supported by Justice Scalia allowed corporations to spend limitless amounts of money on elections with little public disclosure.

Read More: Oligarchy, IFG Wealth and Power , Kochtopus: Koch Cash Influence

 

 

Student Debt Hits $1 Trillion

By: Kourosh Behnam
March 26, 2012

On March 5, 2012  a new report by the Federal Reserve Bank of New York, Grading Student Loans, stated that the outstanding balance of student debt stands at $870 billion surpassing credit card debt ($693 billion) and auto loan debt ($730 billion).

According to the Consumer Financial Protection Bureau (CFPB) student debt has surpassed $1 trillion late last year.  This estimate is 16% higher than the earlier findings by the Federal Reserve Bank of New York.   This figure was released wednesday at a news conference in Austin, Texas.  CFPB officials are planning to release their study this summer.

As reported by the Project on Student Debt, two-thirds of college seniors who graduated in 2010 had an average student loan debt of $25,250.  The state with the highest average student debt in the nation was New Hampshire with $31,048 and the state with the lowest average student debt was Utah with $15,509.  The accumulation of student debt is much higher in the Northeast and Midwest due to students attending private nonprofit four-year colleges.  However, most students who attended  college in the western states accumulated less debt due to their attendance at public four-year colleges.

The price of higher education has been growing at twice the rate of the economy, it has outpaced health insurance and consumer prices in general.  This is due to a long-term tuition bubble.  Price of education has increased while the demand has also increased.  Students are paying more for a deteriorating product, yet it is assumed that this is a financial investment with returns to come following graduation.

Student debt has become the latest financial crisis in America.  If we sit back and do nothing about this, the entire economy will crash again.  We can all disagree on how to fix this growing problem, but if we disagree on its existence then we are spiraling down a unsustainable path that will propel us into another recession.

Although some students have found jobs after graduation, most have not.  With student debt at $1 Trillion congress needs to act fast on how to alleviate or cancel  student debt.  If the government bailed out the big banks with our tax payer dollars then I believe the billionaires should be taxed to cancel student debt!

To help decrease the burden of student debt on our future generation of Americans please read H.R. 4170 The Student Loan Forgiveness Act of 2012. You can also sign the petition here.  This piece of legislation is a crucial step in the fight for student loan debt cancellation.

Read More: Project on Student Debt, Student Loan Debt Top 1 Trillion, Students Loans Blog

How to Reduce Gas Prices and Remove Barriers to Clean Energy: Ban Oil Derivatives

By: IFG
March 21, 2012

Some say higher oil prices are essential to ending our addiction to fossil fuels.

While true in principle, the reality of recent rising costs to consumers has so far been the exact opposite, with political barriers bigger then ever. IFG research shows it can only get worse if current trends continue.

That’s because a major force driving gas prices upward is rampant speculation in unregulated oil derivativesCharles and David Koch are dominant players who in turn plow their profits back in to preventing the phase out of fossil fuels having outspent Exxon and the American Petroleum Institute to kill climate legislation.

While the Koch’s family fortune has steadily expanded with the use of fossil fuels, not until recently did their net worth grow exponentially.  That’s due in large part to their inventing oil derivatives, and then deregulating their trade on Wall Street, and the worldwide.

IFG charts (below) the Kochs’ combined net worth over the past 25 years. It shows how their wealth skyrocketed as speculation on oil markets went wild, with the Kochs making money even when the price of oil goes down.

 Koch wealth for the years 1989, 1995-2000, 2002, 2012-2015 are estimates.

You can see that oil price and Koch wealth are very strongly correlated with a correlation coefficient of 0.94.

With no rules against insider trading, it’s no wonder that the guys who own so much oil infrastructure through which the commodity moves, and also invented the instrument by which traders gamble, can game the system to cash in on such a grand scale.  The Kochs’ combined wealth now ranks them third richest in the world, according to Forbes.

Goldman Sachs recently reported that oil speculation imposes an extra cost of as much as $.56 per gallon of gasoline in the US, an incredible irony when one thinks that this money is then spent to stop the costs of climate change from being included in the price at the pump paid by consumers.

The true price of oil must ultimately reflect its full ecological and social costs, and achieving that requires reducing, if not removing, the role of money in politics. Climate campaigners are currently unable to do that alone, and therefore must work with other movements whose interests are also being bulldozed by these billionaire brothers.

The trajectory of their profits today implies that the undue influence of the Koch brothers is set to soar even higher. Assuming that koch wealth continues in its exponential path their combined wealth will be $82.4 billion in 2015.  Their “shrink government” agenda—which comes amidst calls for massive market interventions to address today’s converging economic and ecological crises—is attacking the very right to clean air, the right to fair wages, and even the right to vote.

Unless key constituencies can come together to counter Koch cash, the implications for people and the planet could be devastating given the Kochs’ control over the current Congress has radically shifted US politics to the right and upcoming elections or ever more driven by cold hard cash.  The Citizens United ruling has spun open the spigot so Koch cash can flow even more freely.

The premise of IFG’s Plutonomy Program is that globalization has, as predicted, upwardly redistributed wealth, where Ultra High Net Worth Individuals are increasingly enabled to exert their own political power and economic ideologies on democratic decision-making everywhere.  Nowhere are the results more clearly expressed than in the rise of the Koch’s wealth and their increasing power over our lives.

Read More: How The Koch Are Fracking America, Charles And David Koch File Suit To Take Over The Cato Institute, Kochtopus Empire