Yesterday, a group affiliated with Occupy Wall Street submitted an astounding comment letter to the Securities and Exchange Commission. Point by point, it methodically challenges the arguments of finance industry lobbyists who want to water down last year's historic Dodd-Frank Wall Street reforms. The lobbyists have been using the law's official public comment period to try to kneecap the reforms, and given how arcane financial regulation can be, they might get away with it. But Occupy the SEC is fighting fire with fire, and in so doing, defying stereotypes of the Occupy movement. Its letter explains:
Occupy the SEC is a group of concerned citizens, activists, and professionals with decades of collective experience working at many of the largest financial firms in the industry. Together we make up a vast array of specialists, including traders, quantitative analysts, compliance officers, and technology and risk analysts.
The letter, which has been in the works for months, passionately defends the Volcker Rule, a provision of the Dodd-Frank Wall Street reforms meant to prohibit consumer banks from engaging in risky and speculative "proprietary" trading. That barrier had collapsed in the 1990s with the gradual watering down, and eventual repeal, of the Glass-Steagall Act. Occupy the SEC explains why this became a problem:
Proprietary trading by large-scale banks was a principal cause of the recent financial crisis, and, if left unchecked, it has the potential to cause even worse crises in the future. In the words of a banking insider, Michael Madden, a former Lehman Brothers executive: "Proprietary trading played a big role in manufacturing the CDOs (collateralized debt obligations) and other instruments that were at the heart of the financial crisis. . . if firms weren't able to buy up the parts of these deals that wouldn't sell. . .the game would have stopped a lot sooner."
What makes Occupy the SEC so unique and inspiring is the way that it straddles the two worlds. On the one hand, it's authentically grassroots, forged in Zuccotti Park's crucible of discontent. As such, it is transparent, open to anyone, and accountable to everyone. On the other hand, it includes financial insiders with the education and regulatory vocabulary to challenge high-powered lobbyists at their own game. That's a powerful combination that the SEC can't easily ignore. From the letter:
The United States aspires to democracy, but no true democracy is attainable when the process is determined by economic power. Accordingly, Occupy the SEC is delighted to participate in the public comment process. . .
Ever wonder what happens to that aluminum beer can, plastic yogurt cup, or cardboard pizza box after you toss it in the recycling bin?
Well, so did the good people at the Massachusetts Institute of Technology, who in 2009 embarked on an ambitious effort to tag 3,000 pieces of trash with GPS-type sensors and track them through the national waste stream. They announced the project shortly after the publication of a three-part series in Mother Jones in which I followed my garbage and recycling through San Francisco's legendary recycling and composting system.
I'd also wanted to attach GPS tags to my trash, but unlike the nerds at MIT, didn't have $300,000 to drop on sensors. The MIT team synthesized their results into this fascinating video, which has been out for a while, sure. But it's still totally worth watching.
In another sign that Democrats have embraced income inequality as a cause célèbre, the Senate Budget Committee held a hearing on the subject today. The committee's ranking Republican, Jeff Sessions of Alabama, managed to look concerned during two hours of testimony about the kneecapping of the Middle Class—not that it should have been all that difficult. Here are some of the hearing's most striking charts:
The 1 percent hasn't controlled such a large share of the economy since the eve of the Great Depression:
But as the rich have earned a larger share, they've paid a smaller and smaller share in taxes:
A major source of inequality in the tax code comes from how it treats investment income. Just ask Mitt Romney, who paid 13.9 percent of his income in taxes in 2010. Most of his earnings came from capital gains, which only get taxed at 15 percent. Proponents of the loophole argue that it helps spur investment, but it also disproportionately helps the rich:
Though America's wealthy are supposed to pay a higher tax rate than the poor (what's known as a "progressive tax code"), they now benefit from so many loopholes that the tax code has, in practice, become increasingly regressive (the Gini Index is a common measure of income inequality):
UPDATE: The Oregonianreports that the bill died in committee today.
Under a bill debated today in Oregon, that tweet could be illegal.
The bill, SB 1534, would make it a felony to use "electronic communication to solicit two or more persons to commit [a] specific crime at [a] specific time and location." The punishment could include up to 5 years in prison and a $125,000 fine.
Critics worry that the bill is so broadly construed that it could outlaw everything from tweets about student sit-ins to Facebook posts calling for the occupation of Zuccotti Park in Manhattan. In Oregon, it might become a tool to crack down on Occupy Portland, which is calling for the nonviolent shutdown of corporations such as Bank of America and ExxonMobil later this month.
Earlier today, activists posted contact information for the bill's 11 co-sponsors and urged allies to call to voice their opposition. None of the lawmakers could be reached for comment this afternoon. In many cases, their phones were busy.
The author of the bill, Oregon Senator Doug Whitsett, defended it during a public hearing today. He wrote it to prevent people from saying: "'We are all going to arrive at Joe's Jewelry Store at 4:55 p.m. on Wednesday afternoon and we're going to rob him blind,'" he said. "This has been happening. At least 8 percent of the retailers in the United States have experienced that type of situation."
Still, speakers at the hearing overwhelmingly opposed the bill. "The law would inhibit somebody like Dr. Martin Luther King," said Eric Coker, an Oregon State PHD student. "It would have prevented something as simple as the Selma Bridge protest. All those people, if they had heard about it through electronic communication, they would all have been subject to a Class C felony."
Dan Meek, an attorney representing the Oregon Progressive Party, added: "I have to say, this is the kind of law that I would expect to see in Myanmar, Turkmenistan, North Korea or Zimbabwe, but not in Oregon."
Grappling with a decisive loss to Mitt Romney in the GOP's Nevada Caucus last night, Newt Gingrich unleashed one of his sharpest attacks ever on the front-runner. "If you can't tell the truth as a candidate for president, how can the country possibly expect you to lead as president?" Gingrich asked a Vegas ballroom full of reporters, referring to Romney's performance in the most recent debate, in Jacksonville on January 26. He added: "I have never seen a person running for president be that untruthful."
Romney surprised nobody with his victory in Nevada. He was holding a pair of aces: a strong on-the-ground operation and the fact that about a quarter of Nevada caucus voters share his Mormon faith. Still, Nevada was a painful bust for Gingrich. Coming after a loss in Florida, his battle with Texas Congressman Ron Paul for a distant second establishes a pattern of declining support for his campaign and hurts his status as standard bearer for the GOP's conservative base.
In a state where a housing and tourism slump is fueling one of the nation's highest rates of unemployment, Romney bested his opponents despite sounding like an out-of-touch rich guy for most of the week. On Wednesday, he'd told CNN's Soledad O'Brien that he was "not concerned about the very poor" because "there is a safety net there." The next day, billionaire Donald Trump didn't much help things when he popped into (where else?) a Trump-branded casino to endorse the former governor. Still, it was Gingrich who emerged from the affair looking clueless. His campaign staff had misled reporters at the New York Times and other major outlets into reporting that the Trump endorsement would go Newt's way, only to see Trump play a different card.