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Last week, tragedy was averted when savvy security at Deutsche Bank (DB) in Frankfurt, Germany, spotted a suspicious package and sequestered a letter bomb intended for the DB CEO. This was the second time Deutsche Bank was attacked in this manner. In 1989, their CEO was killed by a bomb later traced to violent extremists in Germany’s Red Army Faction.

Scanning the horizon for someone to blame for the latest attack on Germany’s largest bank, FOX news pundit Dan Gainor worked “the Internets.” Did he detail Deutsche Bank’s track record of making friends by ripping off consumers and foreclosing on their homes? Did he mention that Deutsche Bank stirred public ire when it was bailed out by multiple governments, including two billion from the U.S. Federal Reserve? Did he even bother to notice that it was widely reported that an Italian anarchist group had already claimed responsibility for the attack?

No. In his piece on FOX News, “Left, Obama Escalate War on Banks Into Dangerous Territory,” Gainor decided to go after the bank-busting activists at the Center for Media and Democracy in Madison, Wisconsin, specifically our BanksterUSA.org site, because the Bankster masthead is riddled with bullet holes.

While I am Italian, I doubt very much that Italian anarchists are getting their inspiration from our little site, which at the moment features a Smithsonian Magazine profile of Ferdinand Pecora and which has been documenting the financial crisis for the past two years.

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Mary Bottari is an experienced policy wonk and communications professional. Bottari launched the “Real Economy” project at Center for Media and Democracy. It demystifies complex issues like synthetic derivatives. She launched the BanksterUSA.org website which urged the FBI to “Book the Crooks” and Congress to “Repo the Dough” in the form of a financial transaction tax.. She coined the term greedwashing to describe bank PR campaigns. She blogs for multiple sites including Campaign for America’s Future, Huffington Post, and the Nation Magazine. Earlier, Bottari worked as senior analyst in Public Citizen’s Global Trade Division and as press secretary to U.S. Sen. Russ Feingold

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This is republished from Open Salon.

Republicans have made quite the show of disparaging the Dodd-Frank financial reform law, calling for its repeal, refusing to provide regulators with the funds to implement it, and blocking nominees for key regulatory positions. Rep. Scott Garrett (R-NJ) took the latest step in that campaign yesterday, introducing a bill that would repeal an important Dodd-Frank safeguard for the financial system.

One of the key factors that led to the housing bubble’s boom and bust was the ability of subprime mortgage lenders to make a loan and then turn around and sell the entire loan to Wall Street. As the Center for Public Integrity wrote, “lenders were selling their loans to Wall Street, so they wouldn’t be left holding the deed in the event of a foreclosure. In a financial version of hot potato, they could make bad loans and just pass them along.” This fueled a dramatic decline in lending standards and gave subprime lenders every incentive to push loans onto people, since the lenders could divorce themselves from all the risk associated with a loan that didn’t pan out.

Dodd-Frank requires that lenders retain at least five percent of their loans, so that they have some “skin in the game.” Republicans on the House Financial Services Committee — following Financial Service Committee Spencer Bachus’ (R-AL) call to “serve the banks” — want to the repeal that requirement:

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Next week President Obama travels to Wall Street where he’ll demand – in light of the Street’s continuing antics since the bailout, as well as its role in watering-down the Volcker rule – that the Glass-Steagall Act be resurrected and big banks be broken up.

I’m kidding. But it would be a smart move — politically and economically.

Politically smart because Mitt Romney is almost sure to be the Republican nominee, and Romney is the poster child for the pump-and-dump mentality that’s infected the financial industry and continues to jeopardize the American economy.

Romney was CEO of Bain & Company – a private-equity fund that bought up companies, fired employees to save money and boost performance, and then resold the firms at a nice markups. (more…)

Better late than never, the movement to take America back from Wall Street has arrived. On Wednesday, the ranks of the Occupy Wall Street encampment will swell as Move­On.org members, union activists and ordinary disgruntled citizens join the demonstration against our financial sector’s misrule of the American economy. What’s more, long-planned anti-bank demonstrations in major cities this week are growing beyond their organizers’ fondest hopes as the Wall Street protest movement catches fire.

The anti-bank campaign has in fact been incubating for years — a “seed beneath the snow,” as the Italian novelist Ignazio Silone once termed the slow-to-arrive left. The sit-ins, teach-ins and street demonstrations popping up in Boston, Chicago, Seattle, San Francisco and Los Angeles are formally the handiwork of a coalition of community groups that recently gathered together as the New Bottom Line. Many of these groups have focused on immediate goals — such as stopping particular banks from foreclosing on more homes. They, along with unions, have demonstrated on Wall Street many times since the 2008 financial crisis. But only now, as Occupy Wall Street — an organization that they didn’t create — has grabbed the public imagination the past few weeks, are the myriad mobilizations commanding the media’s attention.

“It’s a confluence of planned and unplanned demonstrations,” says Stephen Lerner, a longtime organizer for the Service Employees International Union who once spearheaded the union’s successful campaign to organize big-city janitors and today helps guide the groups in New Bottom Line. “We build on each other. We go ping-ponging back and forth.”

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The Take Back the American Dream conference started Mon. Oct. 3, with speakers from Occupy Wall Street, the movement that has galvanized activists nationwide with its stand against corporate greed. Featured in the video are Nelini Stamp of the Working Families Party in New York and Tracy van Slyke of The New Bottom Line financial reform group.

Happy Birthday Dodd Frank,
Happy Birthday to you,
You’ve lost all your muscle,
And your teeth are gone, too.

One full year after the financial reform bill spearheaded through Congress by Christopher Dodd and Barney Frank was signed into law, Wall Street looks and acts much the way it did before. That’s because the Street has effectively neutered the law, which is the best argument I know for applying the nation’s antitrust laws to the biggest banks and limiting their size.

Treasury Secretary Tim Geithner says the financial system is “on more solid ground” than prior to the 2008 crisis, but I don’t know what ground he’s looking at.

Much of Dodd-Frank is still on the drawing boards, courtesy of the Street. The law as written included loopholes big enough to drive bankers’ Lamborghini’s through — which they’re now doing. (more…)

If Jim DeMint gets his way, the Senate will vote any day now on repealing the historic Dodd-Frank financial-reform law. While Senator DeMint is receiving a big assist from conservative lobbying groups, his amendment is sure to fail given the Democratic majority. Still, the tireless war against Dodd-Frank – a law that marks its first anniversary next month – will go on.

Like the assault on the health-care law, the campaign to roll back financial reform is a sophisticated operation bolstered by big money and animated by ideological fervor. What’s different is that cracking down on Wall Street is popular with the American public, and so – DeMint’s frontal assault aside – much of the push to destroy Dodd-Frank has been carried on over power lunches and in the back offices of congressional committees.

Opponents of financial reform have mounted a three-pronged attack.

First, Republican lawmakers hope to block the funds that executive-branch agencies need to implement Dodd-Frank. The legislation that President Barack Obama signed last July is more akin to an outline than a detailed regulatory mandate. It will only have teeth when numerous rules are written and oversight mechanisms are put into place. Getting the money for this work wouldn’t have been a problem if Democrats still controlled the House–but they don’t anymore. (more…)

By Les Leopold
Author, “The Looting of America”

“Thus the real reason for Thanksgiving, deleted from the official story, is: Socialism does not work; the one and only source of abundance is free markets, and we thank God we live in a country where we can have them.” ~ “The Great Thanksgiving Host,” The Ludwig Von Mises Institute - a Tea Party favorite re-write of American History.

Just think, only two years ago Wall Street’s billionaires were on their knees begging for help. Their reckless financial games had crashed the economy. Every firm on Wall Street teetered on the edge of collapse. Without trillions of dollars of government bailouts and asset guarantees, they were finished — kaput. (Please see The Looting of America for the blow by blow on how the “abundance” of financial markets failed.)

But then… a reprieve! The billionaires were bailed out. Congress passed the mildest financial reforms possible. The biggest banks — the survivors — came out of the recession even bigger than before. Wall Street got richer again, and bonuses are now back to near-record levels. Sure, they have to pay back TARP money. Big deal. The profits and bonuses that money leveraged is theirs to keep as if nothing had happened. Is this a great country or what?

But while things are booming on Wall Street, the rest of our economy is in serious trouble. It won’t take much to push us into another downward deflationary spiral, sending unemployment even higher. (Already, year-to-year core inflation has hit its lowest level since this statistic was first recorded back in 1957.) We need 22 million new jobs to get back to full-employment and it’s ludicrous to believe that the private sector can create them on its own in the next decade. But Federal job creation is unthinkable with Congress in gridlock. Meanwhile the states are engaged in a massive anti-stimulus program as they cut back spending in response to crumbling revenues. It seems that the only institution left with a modicum of will and means to prime the economic pump is the Federal Reserve, with a plan called QE2 (a second round of quantitative easing, which means pumping more money into the financial sector.) (more…)

By Les Leopold
Author, “The Looting of America”

If future job creation reaches about 208,000 jobs per month, the average monthly job creation for the best year for job creation in the 2000s, it will take almost 140 months (about 11.5 years) to reach pre-recession employment levels. In a more optimistic scenario with 321,000 jobs created per month, the average monthly job creation for the best year in the 1990s, it will take 59 months (almost 5 years). ~Michael Greenstone, Adam Looney The Long Road Back to Full Employment: How the Great Recession Compares to Previous U.S. Recessions, The Brookings Institution

This may be the first time in American history that the super-rich are experiencing an economic boom while the rest of us are coping with serious economic difficulties. Even during the depths of the Great Depression there was some equality of suffering. Of course, the wealthy weren’t exactly standing in bread lines wondering if they’d ever work again. But the rich and the poor both felt the crisis. This time around, it’s a Tale of Two Cities: the super-rich are doing just fine, thanks to taxpayer largess, even as the rest of us are staggering through the highest sustained unemployment level since 1937.

Our Wall Street billionaires easily weathered the financial storm that they themselves created. It’s as if nothing had happened. The financial reforms Congress passed are weak. The biggest banks actually are bigger. And Wall Street profits and bonuses are approaching record highs. That’s in stark contrast with the fact that more than 29 million Americans are without work or have been forced into part-time jobs.

With the Republican landslide, the super-rich have nothing to fear from Congress. No need to worry about tax increases or tighter regulations now. The hedge funds will be able to hang on to their 15 percent tax rate (by claiming their earnings as capital gains) while raking in $900,000 an hour (not a typo). Meanwhile the pressure mounts to cut social spending — because, of course, we’ve got to combat the large deficits we racked up by giving tax breaks to the rich, bailing out Wall Street, and dealing with the financial crash that Wall Street created. (We get a deficit commission instead of a jobs commission?)

But the real mystery is how quiet progressives are. We seem constitutionally incapable of facing the enormity of the employment crisis.

As far as I can tell, most liberal advocacy groups are carrying on as if the economy hadn’t crashed at all. It’s like we’re all stuck in our remote silos — each working on our own separate issues. We have no shared vision, shared programs or shared will to tackle the broader unemployment crisis. We hope the economy will somehow resurrect itself so that we can go on fighting for our favorite cause without any further interruptions.

Meanwhile, the right, especially the Tea Party, definitely is in crisis mode, and they have a plan. In my opinion they have misidentified the crisis – big government and debt – and have the wrong plan — cut taxes and government spending. But they have a vision, they have passion, and they’re not afraid to challenge not only the Democrats, but the Republicans. They’ve hit on a clever theory to explain the jobs crisis, one that can’t be disproved by facts: It’s caused by big government’s interference in the economy. The solution: slice government spending and regulations so that free enterprise can prosper. And if unemployment still remains high after budget cuts–well, then we just didn’t cut enough. It’s a perfect Catch 22.

And the rest of us are saying… what? What do environmentalists propose to do about the jobs crisis? What is the women’s movement’s economic program? What do progressives involved in healthcare or education think we should do to create the 22 million new jobs we need to get back to full employment?

Yes, there’s a lot of positive discussion about rebuilding our economy through green jobs and renewable energy. But the scale of these proposals is far too small to put much of a dent in the unemployment numbers. Are we all too afraid to say what’s really needed?

We need hundreds of billions of dollars of public investment, right now, paid by taxes on the super-rich.

Why are progressives so timid? Part of the answer lies in our permanent attachment to the Democratic Party. It seems that we can’t ever imagine a time when it would be appropriate to abandon or at least openly fight with the Dems — even those who abandoned us long ago. What will we do as the remaining Blue Dogs move even further to the right, joining with the Republicans on deficit reduction, gutting health care reform, outlawing abortions and stonewalling on climate change? One thing is certain — the Democratic Party is in no mood to lay out a bold national proposal to create the millions of new jobs we need. Most are tacking to the “center” to avoid the fate of Russ Feingold, the very best of the bunch.

What would a massive job creation program look like?

Let’s start with a no-brainer: We hire an army of at least one million installers to weatherize every home and business in the country. Hiring all these workers –at decent wages –through tens of thousands of local contractors will probably add another 400,000 jobs (in addition to the original million) as these re-employed workers spend their earnings. Households and businesses will save on their energy bills, and we’ll reduce global warming emissions. The budget crisis facing state governments will ease as tax dollars start pouring in and unemployment insurance claims plummet. We’ll trigger an economic upswing that’s also good for the environment.

Next, we should fund free higher education at all public colleges and universities, a social good that will also open up the job market by drawing people from the workforce into the educational system. A hiring and construction boom on campuses all over the country will generate a flood of jobs for our millions of unemployed construction workers. This is precisely how the GI Bill of Rights averted what could have been a staggering unemployment crisis after WWII — a time when millions of returning veterans were coming back home in search of work. Through the GI bill, three million instead went to school. Congressional studies show that the GI Bill returned almost $7 dollars of economic growth for every dollar invested — probably the best investment the federal government ever made.

We should also invest massively in alternative energy research, in rebuilding and enhancing our infrastructure, and in meeting a myriad of other needs in our communities. Ask every town in the country to come up with ten projects that need doing right now, and then have the federal government fund them. The ripple effect would wake up our slumbering economy.

Oh, but won’t all this cost a fortune? Aren’t we already tapped out from Wall Street bailouts and the half-assed stimulus program (not to mention two wars)?

Good question — it gets us to the best part of our in-your-face program. We need to make those who crushed our economy, and whom we so generously bailed out, foot the bill. The American people, I believe, would support a windfall tax on financial profits and bonuses and eliminating tax loopholes on hedge funds to fund the jobs we so desperately need.

Time for a Jobs Party?

Will any of this pass in the near future? Of course not. But it’ll never happen if we don’t propose what is really needed.

We have no prayer of tackling the jobs crisis until we articulate a clear-cut agenda and start pressing for it. And we can’t do it alone. We need a sustained, organized voice independent of the Democratic Party that focuses clearly on the jobs crisis. In fact, we should take a cold hard look at creating a Jobs Party. Maybe, one day, it would become a third party that would truly vie for power. But at the very least it could create the same kind of chaos among the Democrats as the Tea Party is creating among the Republicans. Wouldn’t it be nice to see Democratic officials, fearing primary fights, tripping all over themselves to proclaim their allegiance to the Jobs Party agenda?

Right now, the only conversation we’re hearing on jobs is a boring rerun of failed neo-liberalism – cut taxes on the super-rich, deregulate big business and pray for rain. Instead, we need to force politicians to engage in a much more aggressive national conversation about jobs. How are we are going to create the 22 million new jobs to get us back near full-employment?

Will it really take eleven years or more, as the Brookings Institution study (cited above) suggests, for us to get these jobs back? That’s up to us. A Jobs Party with moxie could speed up the timetable during this new era of joblessness.

Maybe all this sound fanciful and unrealistic. But let’s remind ourselves of how fast the world is changing. Did anyone believe that President Obama could go from being America’s darling to chopped liver in less than two years? Did anyone believe that a Tea Party would become a “credible” force among more than 40 percent of the electorate by pushing an agenda that died with Barry Goldwater a generation ago?

Actually, the most fanciful path of all might be hoping we can muddle through indefinitely with the Democrats while ignoring the employment crisis as we plug away, day after day, inside our issue silos.

Come on — let’s say what we really believe in before we forget how.

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Les Leopold is the author of The Looting of America: How Wall Street’s Game of Fantasy Finance destroyed our Jobs, Pensions and Prosperity, and What We Can Do About It Chelsea Green Publishing, June 2009. He is working on a new book, “How to Earn $900,000 an Hour: The Rise of Wall Street Billionaires and the New Class War,” which is to be published in 2011.

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This piece was first published on The Huffington Post.

By Tula Connell
AFL-CIO Managing Editor

When the Republicans take over the U.S. House in January, one of the first things on their agenda is payback to those who helped get them in office: Wall Street.

And they’ve already announced one way they plan to do that.

The financial reform legislation that President Obama signed into law in July gave regulators a significant tool to rein in gambling by big Wall Street banks. The “Volcker Rule,” named after former Federal Reserve Chairman Paul Volcker who proposed it, is aimed at preventing Big Banks from speculating on securities or other complex financial products (a.k.a. “proprietary trading”) and putting strict limits on their ability to bet on hedge funds and private equity funds.

The Volcker Rule would help prevent taxpayers from having to bail out banks that make risky bets and lose, which is exactly what happened during the recent financial crisis. Bear Stearns bailed out two of its hedge funds for more than $3 billion shortly before it was taken over by JPMorgan Chase in a fire sale orchestrated by federal regulators. In March 2008, Citigroup spent $1 billion to bail out several of its struggling hedge funds. Six months later, U.S. taxpayers were forced to inject billions of dollars into Citigroup to prevent a systemic crisis.

Republicans, however, are more concerned with making sure bank executives keep getting richer than preventing taxpayer bailouts. According to the Financial Times this morning, Republican Spencer Bachus, a potential chairman of the House Financial Services Committee, sent a letter to federal financial regulators expressing concern that shareholders of Goldman Sachs and JPMorgan Chase “will be hurt because the banks will be less profitable.”

The Financial Stability Oversight Council, whose members include Tim Geithner, Treasury secretary, and Ben Bernanke, Fed chairman, is this week asking for public comments on how the rules should be written.

Volcker and some Democratic senators are urging a broadly defined ban on proprietary trading and strong limits on Big Bank’s ability to invest in hedge funds and private equity. If regulators take a strong stance on the Volcker Rule, as Volcker and the Democrats have urged, banks will have to take a step back from making bets on complex financial products like derivatives and they will have more money to lend and invest in American businesses that create jobs for hardworking people.

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Re-posted from the AFL-CIO Blog