Nel's New Day

January 2, 2014

Right-Wing Heroes of 2013

A common complaint from the far right is the so-called “liberal media.” Looking at the guests on Sunday political talk shows, however, gives a different picture. Republicans dominate such shows as Meet the Press, Face the Nation, This Week, State of the Union, and, of course, Fox News Sunday. Rep. Mike Rogers (R-MI) topped the list of those who made ten or more Sunday show appearances in 2013; he was on 27 different times, averaging one appearance every 1.9 weeks. Sen. John McCain increased his 21 appearances in 2012 to come in second at 24 times this year. As the chart shows, only three of the top 13 are Democrats. Six of the top seven are Republicans.

Sunday Show Guests

During Rogers’ appearance last Sunday on Fox News Sunday, host Chris Wallace asked him what the New York Times got wrong in its investigation on Benghazi—definitely not a “fair and balanced” question. Rogers was offended that the NYT reported “that Al-Quaeda was not involved in this.” He was also upset that the article questioned GOP claims that an anti-Muslim video made in the U.S. had nothing to do with the attack.

Who are other potential far-right heroes?

Rep. Steve Stockman (R-TX) may be the finest example of GOP extremist wingnuts at the national level. After he decided to run against incumbent Sen. John Cornyn (R-TX) this year, he received more publicity, but his has a rich history of far-right positions since he was sporadically elected since his first bid for the House in 1990:

  • Wants to impeach President Obama to keep him from passing any gun-related legislation, providing every House member with a copy of Impeachable Offenses: The Case for Removing Barack Obama from Office.
  • Compares President Obama and Saddam Hussein based on the presence of children at the president’s announcement pushing for new gun legislation  like Saddam Hussein using children as human shields during the Gulf War.
  • Claims that President Obama’s support for gun safety shows that he has “no sympathy for unarmed women raped by criminals.”
  • Views climate change as “the new fad thing that’s going through America and around the world.”
  • Tweets, “The best thing about the Earth is if you poke holes in it oil and gas come out.”
  • Also tweets that the Boston bomber “thought he could escape in backyard boat after hearing Gore speak on global warming.”
  • Defends the Young Conservatives of Texas group at the University of Texas for its “game” called  “Catch an Illegal Immigrant.”
  • Invites the rodeo clown who wore an Obama mask in the Missouri rodeo to perform in his home state of Texas.
  • Sells this campaign bumper sticker: “If babies had guns, they wouldn’t be aborted.”
  • Raffled off an AR-15, the same weapon type used in the Newtown (CT) massacre, leading to condemnations of “outrageous” and “insensitive” even from GOP colleagues.
  • Used the term “fag” while talking to a reporter.


Food stamps are unnecessary, according to Stockman; his aide accused Democrats trying to live on food stamps were “intentionally buying overpriced food and shopping at high-priced chains to make it appear the cuts go too far.” named Stockman  “the new Michele Bachman,” and he was one of two House members to oppose Speaker John Boehner’s (R-OH) reappointment.

Frustrated because the NRA endorsed Cornyn for the senate in the upcoming primary, Stockman used his endorsement for the House in the last election for his Senate campaign website, “Endorsed by the National Rifle Association.” Recently he tweeted a photo of “liberal tears” as being “the best gun lubricant around. He also takes the position that God granted people “the right to keep and bear arms.”

Liberal tears guns

Elected in 2012 to Ron Paul’s district after a 16-year hiatus from the House, Stockman failed to disclose 17 business affiliations in four states and the British Virgin Islands as mandated by law and gave no details about his personal business. Somehow, $350,000 is unaccounted for, a matter that the House Ethics Committee is addressing.

Washington state Rep. Ed Orcutt (R–Kalama) has potential to be another national far-right hero with his statement that bicycle riders are worse polluters than people who drive cars because they produce more carbon than cars do. It’s all because of the “increased heart rate and respiration” that bicycle riders have. His statements were made in a defense of the proposed 5-percent bicycle tax on bikes that cost more than $500. He lost some of his right-wing cred, however, when he apologized for his comments. The bicycle tax didn’t pass.

Sen. Ted Cruz (R-TX), aTexas wingnut like Stockman, has been at the top of the extremists’ popularity poll, but he may struggle in the coming year. After bragging for the government shutdown almost three months ago, he reversed his opinion when he blamed President Obama and Senate Majority Harry Reid (D-NV), calling it a mistake for them “to force a government shutdown.” He got a lot of cred from shutting down the government; now he’s saying that he didn’t do it. Stockman could make Cruz look like a minor player.

What’s wrong with an honorary and unpaid science laureate to travel the country and inspire children, especially girls and minorities, to be scientists? Larry Hart, a former GOP congressional aide and the legislative director of the American Conservative Union, warned that the position could teach people about climate change. More than half the GOP members of the House and 65 percent of GOP in the Senate deny the existence of climate change or oppose any action connected with it. The position was not approved.

Laura Dimon, daughter of financial criminal and JP Morgan Chase CEO Jamie Dimon, wants criminals such as Trayvon Martin’s killer George Zimmerman, doing hard time, but her list of “6 Most Notorious Criminals [Who] Aren’t Facing the Justice They Deserve” exempts her father. His actions, capitalizing on the subprime mortgage crisis and the rampant foreclosure fraud, negatively affected millions of lives. His bank managed profits in the billions of dollars by forging signatures to force people out of their homes. The financial crisis, which Dimon manipulated and exacerbated as Chase Bank’s CEO, led to at least 5,000 suicides, far worse than the Boston Marathon bombing.

In the “London Whale” scam, Dimon’s bank admitted that it violated securities laws, and Dimon himself admitted that he violated the law by guaranteeing that all information in the SEC filings is accurate. His penalty would have been a $5 million fine and up to 20 years in prison if he had been indicted and convicted. No one went to prison, and taxpayers will pay $7 billion of the $13 billion settlement.

Billionaire founder of Home Depot Ken Langone can be representative of many wealthy people in this country. He’s trying to raise $180 million to restore New York’s St Patrick’s Cathedral and thinks that Pope Francis’s criticism of capitalism and wealth might discourage donors. Langone has said:

“I’ve told the cardinal [Timothy Dolan], ‘Your Eminence, this is one more hurdle I hope we don’t have to deal with. You want to be careful about generalities. Rich people in one country don’t act the same as rich people in another country. You get more with honey than with vinegar.”

Dolan will also be revered by the right wing for his comment that the pope “also loves rich people” and that the wealthy donor misunderstood Francis’ message. Langone agrees, explaining that capitalism in Argentina is different than in the United States. He missed the point that as of 2011, inequality of income was far greater in the U.S. and in Egypt—and it’s only gotten worse in this country during the past two years.

Along with the beloved right-wing people is the corporation, McDonalds. Its website is now gone, but these insults toward its poorly-paid employees will remain on the Internet for long into the future. Although intended to be helpful advice for its employees because some of them could not survive on the minimum wage paid by the company, recommendations from the McResource Line showed the tremendous gap between the wealthy and the rest of the people in the United States:

  • A budget plan allowing for a whopping $20 per month in health insurance and $0 for heating; totaling both car and homeowner’s/renter’s insurance for $100 per month; and requiring a second income, such as another job.
  • Seeking government assistance at a time when the GOP is blocking any safety net and the unlivable pay at fast-food industries costs taxpayers $7.7 billion per year.
  • Cutting food into small pieces to reduce workers’ hunger.
  • Selling Christmas gifts on eBay for additional income.
  • Advice on tipping people like dog walkers, personal trainers, housekeepers, pool workers, caddies, and au pairs, among others, including how to give gifts as tips.

The tipping point in the decision to drop the website may have been the recommendation for healthy eating.


In this case, the hypocrisy was double-headed: the advice pointed out that the company’s own food is not healthy. Instead, of getting a McDonalds cheeseburger, fries, and drink, Resource Line recommended something like Subway food—a sandwich, salad, and water. I will miss the website, but the tragedy will remain .

April 10, 2013

Stop U.S. Bank ‘Bank Ins’

Economics are one of my weak points. I know just a tiny bit more about this field than sports, about which I know nothing. But with the stock market shooting up like a meteor, the GOP budget plan shooting the majority of individual income in the United States down into the center of the world, I decided to pay attention to this article, “The Wall Street Ticking Time Bomb That Could Blow Up Your Bank Account,” by Ellen Brown.

She definitely got my attention with the describing the “bail in” which took place in the two bankrupt Cyprus banks, especially because all the big monitory control groups okayed this. “Bail out,” much resented by people across the United States, means that the government uses taxpayer money to give all those “too big to fail” banks that gamble away their own capital. “Bail in” means that banks “recapitalize” themselves by taking their creditors’ funds deposited in their banks. It just skips the middle process of getting people’s money from the government. This policy is already in the works for the United Kingdom, Canada, New Zealand, Australia,–and the United States.

Why are banks in trouble? It has to do with derivatives, a word that always confuses me. From what I can understand, the problem with derivatives is that they can change in value from one moment to the next because they are a contract based on assets that change—commodities, bonds, interest rates, etc.

Because derivatives can shift in value from one instant to the next, the Glass-Steagall Act of 1933 tried to prevent another Great Depression by stopping banks from gambling with depositor funds. In 1999 Congress removed that barrier, meaning that banks could take money from savings accounts and gamble them away in the derivative market. The loss of the derivatives goes to the bank; the owner of the contract takes the collateral—i.e., your savings or retirement account.

In 2008, to save the banks—and all the personal accounts in them—the government “loaned” them $700 billion in taxpayer funds. Think what it would take to save the banks now. The FDIC insurance fund, which covers all those bank deposits under $200,000 has only $25 billion. Two banks, JPMorgan and Bank of America, each have over $1 trillion in deposits, and total deposits covered by FDIC insurance are about $9 trillion. Bloomberg stated in November 2011 that Bank of America’s holding company had almost $75 trillion in derivatives, and 71% were held in its depository arm; while J.P. Morgan had $79 trillion in derivatives, and 99% were in its depository arm. The cash calculated to be at risk from derivatives from all sources is at least $12 trillion.

When the FDIC (Federal Deposit Insurance Corporation) runs out of money, Section 716 of the Dodd Frank Act prevents more taxpayer funds bailing out a bank because of a bad derivatives gamble. That means no more $700 billion taxpayer bail outs, moving the banks on to bail ins.

Legally a bank owns our money the second we put in into their bank. We become “unsecured creditors” holding IOUs, promises to pay. Until recently, the bank was obligated to pay our money back on demand.  Four months ago, the FDIC and the Bank of England (BOE) put out a document, “Resolving Globally Active, Systemically Important, Financial Institutions.” Under the FDIC-BOE plan, our IOUs are converted into “bank equity.”  The bank gets the money, and we get stock in the bank. When our IOUs are converted to bank stock, they are no longer subject to insurance protection. Instead, the deposits will be “at risk” and vulnerable to being wiped out. As “unsecured creditors,” depositors are put below interbank claims. The function of the FDIC may have been changed to confiscate deposits to save the big banks.

The only mention of “depositors” in the FDIC-BOE directive as it pertains to U.S. policy is in paragraph 47: “The authorities recognize the need for effective communication to depositors, making it clear that their deposits will be protected.” There is no indication of how the depositors will be protected if the assets are gone. The derivatives claimants are first in line, before the depositors. There is no rescue from taxpayers because Congress stopped that alternative. The FDIC has only $25 billion.

“Secured creditors,” including state and local governments, are also in trouble because many of them keep revenues in Wall Street banks with smaller local banks lacking the capacity to handle such complex business. Although U.S. banks are required to pledge collateral for any deposits of public funds, the derivative claims have super-priority over other claimants, including other secured creditors.

Harvard Law Professor Mark Row maintains that the super-priority status of derivatives needs to be repealed. He writes:

“. . . [D]erivatives counterparties, . . . unlike most other secured creditors, can seize and immediately liquidate collateral, readily net out gains and losses in their dealings with the bankrupt, terminate their contracts with the bankrupt, and keep both preferential eve-of-bankruptcy payments and fraudulent conveyances they obtained from the debtor, all in ways that favor them over the bankrupt’s other creditors.

“. . . [W]hen we subsidize derivatives and similar financial activity via bankruptcy benefits unavailable to other creditors, we get more of the activity than we otherwise would. Repeal would induce these burgeoning financial markets to better recognize the risks of counterparty financial failure, which in turn should dampen the possibility of another AIG-, Bear Stearns-, or Lehman Brothers-style financial meltdown, thereby helping to maintain systemic financial stability.”

In The New Financial Deal: Understanding the Dodd-Frank Act and Its (Unintended) Consequences, David Skeel calls the Dodd-Frank policy approach “corporatism”–a partnership between government and corporations. Congress has made no attempt in the legislation to reduce the size of the big banks or to undermine the implicit subsidy provided by the knowledge that they will be bailed out in the event of trouble.

Skeel also blames the Lehman bankruptcy of 2008 on the bankruptcy exemption for derivatives. When the bank seemed to be in trouble, the derivatives owners all made their claims, causing a run on the collateral before it ran out. According to Skeel, the problem could be resolved by eliminating the derivatives exemption from the stay of proceedings that a bankruptcy court applies to other contracts to prevent this sort of run.

Other ways to block the Wall Street asset grab:

  • Restore the Glass-Steagall Act separating depository banking from investment banking. (H.R. 129)
  • Break up the giant derivatives banks.  (Bernie Sanders’ “too big to jail” legislation)
  • Nationalize the “too big too fail” banks as recommended in the New York Times. (Gar Alperovitz)
  • Make derivatives illegal, as they were between 1936 and 1982 under the Commodities Exchange Act. They can be unwound by simply netting them out, declaring them null and void.  As noted by Paul Craig Roberts, “the only major effect of closing out or netting all the swaps (mostly over-the-counter contracts between counter-parties) would be to take $230 trillion of leveraged risk out of the financial system.”
  • Support the Harkin-Whitehouse bill to impose a financial transactions tax on Wall Street trading.  Among other uses, a tax on all trades might supplement the FDIC insurance fund to cover another derivatives disaster.
  • Establish postal savings banks as government-guaranteed depositories for individual savings. Many countries have public savings banks, which became particularly popular after savings in private banks were wiped out in the banking crisis of the late 1990s.
  • Establish publicly-owned banks to be depositories of public monies, following the lead of North Dakota, the only state to completely escape the 2008 banking crisis. North Dakota does not keep its revenues in Wall Street banks but deposits them, by law, in the state-owned Bank of North Dakota.  The bank has a mandate to serve the public, and it does not gamble in derivatives.

The Volcker Rule, part of the Dodd Frank Act that keeps banks from making some speculative investments, doesn’t go into effect for over a year. U.S. banks are fighting it, lobbyists are trying to postpone the date, and there may not be enough money to monitor it.

If you think that banks are responsible entities, think about the way that Jamie Dimon misled investors and regulators to lose over $6 billion for JP Morgan Chase. According to Sen. Carl Levin (D-MI) regarding the Senate investigation into Dimon, JP Morgan had “a trading operation that piled on risk, ignored limits on risk taking, hid losses, dodged oversight and misinformed the public.”

Google the subject of “bail-in,” and you’ll find a pile of articles that indicate there is no problem about people in the United States losing their bank deposits. That’s what the banks said during the Great Depression right before they permanently closed their doors.

This morning my partner and I talked about when the next Wall Street financial disaster would occur. I’m guessing that it will be in a little over a year—just in time for the GOP to blame the Democrats on Wall Street problems in order to get votes. Now might be the time to stop worrying about the national budget and think about what happens if we lose their bank deposits.


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