THIS WEEK IN AMERICA: August 2, 2013
National Nurses United, 8/2/13
Banks Take Homes from Millions. In a compelling report on Alternet, highlighting how huge numbers of Americans have lost their residences, Laura Gottesdeiner, writing for TomDispatch, estimates that 10 million people have seen their homes taken away by banks since the financial crisis in 2007. Some, writes, Gottesdeiner, at gunpoint:
“Since 2007, the foreclosure crisis has displaced at least 10 million people from more than four million homes across the country. Families have been evicted from colonials and bungalows, A-frames and two-family brownstones, trailers and ranches, apartment buildings and the prefabricated cookie-cutters that sprang up after World War II. ... They add up to approximately the entire population of Michigan.”
African American neighborhoods were the particular targets of aggressive foreclosure, according to Alternet. “At the height of the rapacious lending boom, nearly half of all loans given to African American families were deemed ‘subprime’”.
In North Carolina , the report details, when Nicole Shelton attempted to move back into her repossessed home in a picket-fence subdivision, the Raleigh police department dispatched a dozen police officers and an eight-person SWAT team. “Officers were equipped with M5 submachine guns. A helicopter roared overhead. In Boston, one organizer with the community group City Life/Vida Urbana remembers the police acting so aggressively at an eviction blockade in a Haitian neighborhood that the grandmother of the family suffered a heart attack in the driveway.”
According to a 2012 report authored by the National Fair Housing Alliance, foreclosures in minority communities in the U.S. have constituted “the largest loss of wealth for these communities in modern history.” Between 2009 and 2012 African Americans lost just under $200 billion in wealth, bringing the gap between white and black wealth to a 20-to-1 ratio, according to Alternet.
Threats to Food Stamps Continue. Congress continues to focus on cutting food stamps, threatening essential food assistance to about 5.1 million people, reported the New York Times. The estimate comes from the Health Impact Project, , a Washington research group, in a study released this week about the impact of the proposed cuts to the food stamp program.
The report said the cuts to the program, also known as the Supplemental Nutrition Assistance Program, or SNAP, would not only affect the ability of low-income households to feed themselves but would also increase poverty.
“The combination of poverty and a lack of food would lead to increases in illnesses like heart disease, diabetes and high blood pressure among adults, the study found. In children, the cuts would lead to higher rates of asthma and depression. Diabetes alone could increase federal and state health care costs by nearly $15 billion over the next 10 years,” according to Times’ reportage on the report.
Losing Ground in the U.S. The U.S. ranks in the bottom third of industrial countries in terms of outlays on social programs, such as unemployment insurance and day care, reported the New York Times. Over half — 52 percent — say that the government should redistribute wealth by taxing the rich more, wrote the Times, citing an April Gallup poll.
A Call for an Investigation of top economist Lawrence Summers. Former White House economist Lawrence Summers remains on a short list of candidates to head the Federal Reserve, a powerful position in the hierarchy of the nation’s monetary policy. But opposition to Summers mounts, focusing on calls for an investigation into Wall Street payments received by him.
Writing in Huffington Post, Robert Scheer outlines Summers postings: as top deputy to Treasury Secretary Robert Rubin during the Clinton Administration, subsequently succeeding Rubin upon his departure. (Rubin joined Citigroup, adding a sum in excess of $100 million to the wealth he accumulated at Goldman Sachs during his tenure in top management there.)
“As Clinton's Treasury secretary,” says Scheer, “[Summers] pushed for radical deregulation allowing investment bankers to take wild risks with the federally insured deposits of ordinary folks, a disastrous move compounded when he successfully urged Congress to pass legislation banning the effective regulation of the tens of trillions in derivatives that often proved to be toxic.” These efforts laid the groundwork for the financial collapse in 2007.
Thanks for the new laws inspired by Summers, merger mania swept through Wall Street, including the creation of Citigroup. “Eight years later,” writes Scheer, “the federal government had to save Citigroup from bankruptcy brought on by its leading role in the sale of those toxic mortgage-based derivatives, to the tune of $45 billion in taxpayer funds and backing $300 billion of the bank’s bad paper.”
Later, with the Democrats no longer in the White House, Summers picked up $45,000 per lecture from Citigroup, a small piece of the $8 million he earned for consulting at the D.E. Shaw hedge fund.
According to Scheer, citing Wall Street Journal reports, Summers re-entered service with Citigroup. “Neither he nor the bank has revealed his current rate of pay,” though reports have his speech fee at $100,000 per….
Citigroup is popular place for top Democrats. Rubin and Summers can attest to that. And Treasury Secretary Jack Lew worked there as a top executive, as well, and former Obama budget czar Peter Orszag is today on the mega-bank’s payroll, serving as Citigroup’s Vice Chairman of Corporate and Investment Banking, Chairman of the Public Sector Group, and Chairman of the Financial Strategy and Solutions Group.
At a Citigroup forum in March, reports Scheer, “Mr. Summer expressed surprise about the persistent backlash in Washington toward big banks.” Hard sell.
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