In Minnesota, Republicans are gleefully waiting for the chance to  target public employee unions if they retain control of the state legislature. Here’s what the Speaker of the Minnesota House had to say about public workers:

As far as public sector unions – whether it’s state workers or teachers unions – they should not have a different set of standards that are above and beyond the taxpayers that are actually funding their salaries and funding their benefits,” Zellers said. “The days of a gold-plated government versus what an average Minnesotan gets paid, I think, are gone.

Sure, it’s easy to get people to resent state employees by flooding them with contextually-challenged messages about gold-plated benefits, but comparing the salaries and benefits of agency heads and school superintendents to “average Minnesotans” is disingenuous at best. Most government employees do not have lavish salaries or benefits, and are lucky if they can hang on to a low five-figure income. Still, Republicans all over the country are happy to run on the politics of envy and to contribute to the  wage race to the bottom for all workers.

It’s up to us to point out the obvious, to confront Republicans  on their false narrative, and to remind everyone of who these politicians really serve.

Since this move by the city was sparsely covered by the local news outlets (YNN, KUT), here’s a little of what you missed if you did not attend the March 22nd meeting:

The city’s Interim Chief Financial Officer Elaine Hart read from her four-page memo, reiterating Austin’s financial needs and how only the largest banks can provide for them. When questioned by Council Member Bill Spelman about whether the city’s contracts could be split between several smaller institutions, the response was no, because making sure that the financial arrangements were being followed by the banks would be a nightmare for city staff. There were, however, no concerns as to whether the contract with Chase Bank would be in the city’s best interest. The contract was awarded despite JPMorgan Chase’s settlement in July of last year with the Securities and Exchange Commission over the rigging of the municipal bond market. Chase has also settled lawsuits dealing with excessive overdraft fees, cheating veterans and defrauding the federal government, among other egregious activities. When questioned by Council Member Kathie Tovo as to whether the Chase contract could be limited to one year while the city gathered more information,  city staff responded that no bank would enter into a one-year contract, that the shortest contract could be 36 months, and that reopening the bidding would be a logistical nightmare for city staff.

And of course, there was the mention of those other cities – San Francisco, Berkeley, Seattle, Philadelphia, all with responsible banking resolutions, and all still tied to contracts with Bank of America or Wells Fargo. Since those cities couldn’t make the move, why should Austin try to change anything.

Several citizens spoke at the meeting, reminding the Council of Chase Bank’s horrible treatment of its customers and of its settlements with the federal government, not to mention the bailouts. But when Claire Hirschkind spoke, she noted that at least one credit union, Members’ Trust FSB, was interested in a contract with the city, but was never contacted. While not a local institution, it is a credit union that might have a better record with its clients than Chase Bank.

One of the more surreal moments was the discussion about which of the three finalists, now famous for ripping off their customers, including governments both federal and local, was best able to handle Austin’s finances for the lowest price. Chase was deemed the winner of that sweepstakes, having scored the highest on the city’s grading system.

So now Austin will bank with another too-big-to-fail institution for at least the next three years. While Occupy Austin and others tried to stop this fiasco from occurring, it is now incumbent on all of us to keep the pressure on the City Council, to push them to work with responsible banking institutions. The contract we are now stuck with has a two-year renewal option. Let’s make sure the City Council understands that this three-year contract is the most we will grudgingly accept.

UPDATE (March 26th):

Today a member of Occupy Austin’s Bank Action Committee spoke with Council Member Bill Spelman concerning the City of Austin’s vote awarding a banking contract to Chase Bank. The following statement/questions were sent to Mr. Spelman, indicating Occupy Austin’s continued work on this issue.

Thank you for taking a moment out of your breakfast time this morning to speak with me. While we are collecting information from various member trusts operated on behalf of local and regional credit unions, we want to make sure that you, your colleagues, and staff have a clear understanding of the questions we’d like answered. These questions are attached and pasted and the bottom of this message.

Our folks look forward to your response. Thanks again.
There are over 30 days left for the City Manager Office to examine the city’s banking contracts.  We are asking you to get answers to the following questions:

•  Were you, or someone from your staff given a copy of the RFA issued in August of 2011? If so, we are asking you for a copy, as well as a list of the 112 banks it was distributed to.
• What criteria were used to determine which banks would receive the RFA?
• After multiple requests for information regarding city financial contracts dating from October to February, we were never told about the already-issued RFA. Why did members of City Council and staff withhold this information?
• Why were responsible banking criteria like foreclosure rates, payday lending, etc not included in the RFA?
• Has the contract with JP Morgan Chase already been signed?
• What is the history of the city’s relationship with JP Morgan Chase? How many contracts have been signed between the City and JPMC, and what caused the city to change banks in previous years?
• Why didn’t the Deputy Chief Financial Officers and the City Manager consider  extending the current depository contract with Bank of America for one year in order to reopen the RFA and include responsible banking criteria?
• If the city signs with JPMC, are you willing to push the City Manager to leverage this new relationship by requiring that JPMC invest a certain percentage of the city’s assets in the local economy? Are you willing to push for a moratorium on foreclosures by JPMC in the Austin/Travis County area?

But this is no victory for the citizens of Austin. The city’s financial office is suggesting that Austin move its money from too-big-to-fail Bank of America to too-big-to fail Chase Bank, and a vote will be taken (it’s agenda item #56) at the March 22nd City Council meeting. We now know that Austin had initiated a Request for Application in the Summer of 2011 because its five-year contract with Bank of America was coming to an end. So even before Occupy Wall Street or Occupy Austin had begun, before the generalized public outrage which led to the removal of more than $1.6 million from Austin branches of Wall Street banks and into local banks/credit unions, the city had started its search for a new banking contract. It appears that  city government is having a good laugh at the expense of Occupy Austin, all the way to the too-big-to-fail bank.

A memo from Austin’s Interim Chief Financial Officer notes that 112 Requests for Application were sent out in August and only three banks replied – Bank of America, Chase and Wells Fargo. It’s a good thing that BOA didn’t have the highest score on the RFAs or the city would have even more explaining to do. The memo notes that requests were sent to three  local banks. Those banks are not mentioned by name in the memo, but they apparently did not respond:

In October 2011, after discussing this issue with the City Council, staff began to informally assess the capabilities of alternative banks, such as credit unions to manage the city’s banking needs. This assessment began by evaluating the responses to the RFA, which detailed the City’s specific depository needs. The RFA was sent to three banks that can be considered regional/local. THE RFA was also published in the local Austin American Statesman. None of these three local/regional banks submitted an application to be considered for this contract. None of these three, nor any other financial institution that can be considered regional/local participated in the pre-bid opening that occurred on August 11, 2011. Staff can infer from receiving no responses from any regional/local bank that they were unable to m eet the requirements set out in the RFA.

It is true, as I noted in an earlier post on this subject, that credit unions would need to jump through some hoops in order to accept the city’s money. Section 701.32 of Title 12 of the Code of Federal Regulations  (Banks and Banking) notes:

b) Limitations. (1) Unless a greater amount has been approved by the Regional Director, the maximum amount of all public unit and nonmember shares shall not, at any given time, exceed 20% of the total shares of the federal credit union or $1.5 million, whichever is greater.

(2) Before accepting any public unit or nonmember shares in excess of 20% of total shares, the board of directors must adopt a specific written plan concerning the intended use of these shares and forward a copy of the plan to the Regional Director.

It includes details of the planning and reporting that needs to be done before a credit union can accept funds in excess of the limits described above. It’s a lot of work and in the pre-Occupy Wall Street era, probably too much work. But given the current public outrage over the complicity of these too-big-to-fail banks in the mortgage meltdown and ensuing financial crisis,  isn’t it possible that now some of the local banks or credit unions might be able to find a way to accommodate the city’s finances.

Please consider attending the March 22nd Austin City Council meeting and speaking out against this proposed move.

As it was sparsely reported by a couple of news outlets (KUT Radio and YNN) the council tasked the City Manager to study how to accomplish the move and to report back in sixty days. So on May 1st we should have some idea of how the city will proceed.  In order to accomplish this move, the City of Austin and its future financial institution will have to navigate a jumble of state and federal rules and regulations

Here are some of the statutory issues Austin and its prospective credit union will have to work with:

The Texas Finance Code notes that credit unions can accept  municipal funds. But the National Credit Union Administration rules and regulations place a  limit on the amount of money a credit union can automatically take in  from public entities:

(b) Limitations. (1) Unless a greater amount has been approved by the Regional Director, the maximum amount of all public unit and nonmember shares shall not, at any given time, exceed 20% of the total shares of the federal credit union or $1.5 million, whichever is greater.

Any credit union responding to a Request for Proposal from the City of Austin will need to submit a plan as stipulated in section 701.32 of the NCUA rules and regulations (part of Title 12 of the Code of Federal Regulations).

The Texas Government Code lists the type of institutions that can accept public securities, and credit unions are not specifically mentioned, though the state Comptroller can designate institutions as “custodians”  as explained in section (iii) below:

Instead of depositing pledged securities with the comptroller, a depository may deposit them with a custodian.  The custodian may be the (i) Texas Treasury Safekeeping Trust Company, (ii) a state or national bank that has a capital stock and permanent surplus of not less than $5 million, is a state depository, and has been designated as a custodian by the comptroller, or (iii) a financial institution authorized to exercise fiduciary powers that has a capital stock and permanent surplus of not less than $5 million, has its main office, branch office, or a trust office in this state, and has been designated as a custodian by the comptroller.  For purposes of this subsection, “financial institution” has the meaning assigned by Section 201.101(1), Finance Code.  The comptroller may designate those custodial applicants that are acceptable and may reject those whose management or condition, in the opinion of the comptroller, do not warrant the placing of securities pledged by state depositories.

There are obviously some hoops to jump through in order for the Austin to move its money out of Bank of America and into a credit union, but judging from the response I got from an official at my credit union at the idea of doing business with the City of Austin, the interest is definitely there, and the obstacles are not insurmountable.

Please take action and let your local credit union/banking institution know how important it is to you that the city sever its financial relationship with Bank of America and request that they help facilitate the city’s divestment from a too-big-to-fail bank to a responsible local option.

Now in Virginia the military police, because what else can you call these state police officers who wear military garb, carry assault weapons and tear gas canisters, and use dogs as part of their intimidation tactics, have been deployed to help arrest protesters  who were demonstrating against that state’s proposed ultrasound law, a horrendous Republican overreach intended to shame and humiliate women seeking abortions.  The law awaits the Governor’s signature, and opponents have been protesting in an officially sanctioned manner, but when demonstrators in Richmond decided to  link arms at the state Capitol, it was seen as an escalation of such a magnitude that it necessitated the intervention of the Virginia State Police Tactical Squad with all of their Department of Homeland Security gear. So said a spokesman for the Capitol police, who also noted that the huge police presence was the fault of the demonstrators: “ He said that the protestors “knew the rules and intentionally violated them.””

The result of this conflagration at the Virginia Capitol seems particularly understated considering the law enforcement presence:

 The thirty protestors that were arrested were charged with trespassing and unlawful assembly, each a Class 1 misdemeanor. Capt. Goodloe maintained that several of the arrestees behaved in a manner that indicated they wanted to be taken into custody, but that there was “no violence from the protestors.” Neither police nor protestors were injured during the event.

Thirty protesters  ready to be arrested, not putting up a fight, no injuries – and for this the state of Virginia deploys an excessive amount of force.  Apparently there are no other uses for the Department of Homeland Security grant moneys, so Americans exercising free speech are now considered a threat. As the country continues to militarize its state and local police forces, when do we say enough is enough?

You would think that Bank of America’s recent mortgage fraud settlement with the state Attorneys General and its settlement of a discrimination lawsuit late last year might prompt one of the states involved in the fraud  settlement to avoid doing business with the bank. Despite the record fines imposed on the banks, these settlements are viewed as toothless to keep Bank of America and the other too-big-to-fail banks from repeating their fraudulent activity. But Texas is poised to deliver any number of its almost 400 thousand state employees to BOA by offering the TexPayCard, a debit card linked to the bank which would contain the employees’ paycheck on a monthly or bi-weekly basis. The state Comptroller’s Office no longer wants to issue checks and has turned to one of the banks implicated in serious mortgage fraud to manage state employees’  money through this pre-paid debit card.  Just the juxtaposition of Bank of America and debit cards should raise red flags with state officials; instead state agencies are now notifying their staff as in this week’s reminder from the Health and Human Services Commission:

Enrollment has begun for the TexPayCard program, which allows state employees to receive their pay on a prepaid payment card rather than by paper warrant or by direct deposit to a bank or credit union.

A picture of the debit card accompanies the flier describing this “service” which is billed as a convenience for employees who do not currently have direct deposit or even a bank account as a way to avoid check cashing fees. But it also being marketed to workers who currently have accounts with a financial institution:

While the card may appeal most to employees who receive their pay by warrant, the program also is available to employees who have direct deposit to a bank account.

Prominently missing on this graphic depiction of the TexPayCard is any mention of Bank of America. True, these cards aren’t necessarily ready, and they may yet be embossed with the bank’s name, that remains to be seen. The fees are listed on the back of the flier and include a $15 emergency cash transfer fee, $1.50 for use at non Bank of America ATM, and $3.50 for international ATM withdrawals, and 50 cents each time a transaction is declined at an ATM.

While the state is willing to overlook Bank of America’s dismal record, the City of Austin, under pressure from Occupy Austin and the 1.5 million dollars Austin-area residents have removed from the large mega-banks that tanked the economy, is considering the possibility of moving its money out of the bank. Agenda item #48 at the March 1st City Council meeting calls on  the Austin City Council to discuss and  vote on a resolution sponsored by Council members Morrison, Tovo and Mayor Leffingwell, to study how to move its funds:

WHEREAS, investment practices and subprime lending policies by major national banks led to a global downturn in the economy and influenced a massive wave of foreclosures throughout the country, including Austin; and

WHEREAS, foreclosures affect the stability of Austin’s neighborhoods and place strain on a student’s opportunity for academic success when families are forced to move throughout the school year; and

WHEREAS, it is in the interest of the City of Austin to ensure public funds are invested in financial institutions that support our local community; and

WHEREAS, the City of Austin has a long-standing tradition of supporting local businesses, which fosters sustainability of our economy; NOW THEREFORE

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF AUSTIN

That the City Manager is directed evaluate and report back to the City Council within 60 days regarding the following:

1. The current status of the city’s depository contract, including information on renewal options and the timing for the solicitation process; and

2. Fiscal and operational impacts of terminating the current depository contract and contracting with an alternative local or regional bank, including the feasibility of a credit union; and

3. A comprehensive analysis of the capacity of alternative banks, such as credit unions, to maintain and manage the city’s banking needs.

BE IT FURTHER RESOLVED

The City Manager is directed to review the city’s current banking policies and make recommendations on changes to give preference to banks that support community reinvestment goals, such as the stabilization of the housing market, provision of loans to local homeowners and businesses, establishment of local branches in low- income communities, and opportunities for local employment.

Needless to say, a large presence at the March 1st  City Council meeting, or outside at City Hall Plaza at 1st and Lavaca, will go a long way towards moving the Austin City Council in the right direction. The Council meeting starts at 10 am. Please consider attending.

Open Secrets has listed 332 “superpacs” which have received almost $100 million in donations and have spent more than $51 million so far in the 2012 elections. These organizations were helped along by an appeals court ruling in Speechnow.org v FEC, a ruling that cites the Citizens United case to make its determination that:

The contribution limits of 2 U.S.C. § 441a(a)(1)(C) and 441a(a)(3) violate the First Amendment by preventing plaintiffs from donating to SpeechNow in excess of the limits and by prohibiting SpeechNow from accepting donations in excess of the limits.We should be clear, however, that we only decide these questions as applied to contributions to SpeechNow, an independent expenditure–only group. Our holding does not affect, for example, § 441a(a)(3)’s limits on direct contributions to candidates.

As Open Secrets explains it:

Super PACs may raise unlimited sums of money from corporations, unions, associations and individuals, then spend unlimited sums to overtly advocate for or against political candidates. Super PACs must, however, report their donors to the Federal Election Commission on a monthly or quarterly basis — the Super PAC’s choice — as a traditional PAC would. Unlike traditional PACs, Super PACs are prohibited from donating money directly to political candidates.

The Citizens United case allows for unlimited donations to these entities and corporations and their CEOS have become even more profligate donors. The Republican candidates’ uber-rich patrons include hedge fund millionaires in Mitt Romney’s Restore Our Future organization, a Nevada casino mogul eager to dictate the country’s Israel policy now supporting Newt Gingrich with

“a principled contribution to a man who Mr. Adelson believes shares his values and vision for America.”

So principled was the billionaire Adelson’s donation to the Winning our Future superpac  that he let it be known that he would be happy to support the eventual Republican nominee should that individual be, say, Mitt Romney.

Not to be outdone, Rick Santorum has the Red White and Blue Fund superpac, bankrolled mostly by millionaire Foster Freiss, whose advertising successes in recent primaries heralds more money spent in upcoming primaries

Because of the breadth of Santorum’s wins, Roy said the group is engaging in more upcoming states than it previously planned.

“We are taking a hard look at states that may have previously been viewed as completely uphill. For instance, a couple of the southern states are in play since Romney’s northeastern politics don’t play well there. And although Gingrich may look a bit like Paula Deen, politically he’s no Southerner.”

Mr. Freiss might want to stick to donating money to create nasty ads as opposed to upstaging his chosen candidate with “in my day” quips about women (gals) and birth control (aspirin clenched tightly between the knees).

With all of the unlimited  money and the successful ads those donations have spawned keeping seemingly moribund  campaigns alive, it’s probably no surprise that the Obama campaign has jumped into the superpac unlimited money arena. Democratic-leaning groups are now considering joining together in a more concentrated effort to locate donors willing to pitch in 1-10 million dollars. This effort is justified as a way to lessen the confusion of potential donors who in the past were approached by various different entities for money.

Democratic fundraisers say that potential donors have been confused by multiple requests for help from different super PACs working to boost Obama’s campaign as well as the two congressional campaign committees. Last fall, several of the super PACs tried to allay some of these concerns by holding joint meetings with donors, including one in Boston.

The weak super PAC fundraising last year is partly attributable to the much more robust efforts of the Obama campaign and the Democratic National Committee, which together pulled in more than $233 million. By comparison, leading GOP contender Mitt Romney’s campaign and the Republican National Committee pulled in only $144 million.

Apparently, the strength of the superpac is inversely proportional to the strength of the political party donation mechanism. The weaker a political campaign’s ability to gather money, the stronger its superpacs become. If superpacs were cells, we might start talking about cancer, which is exactly what this type of fundraising is – a cancer which allows for the unlimited growth of the agenda of a few very wealthy individuals while the healthy cells of democracy shrivel into irrelevance.

The only way to fight this is to reject the notion that corporations are people and that the extremely wealthy are entitled to donate unlimited amounts in order to foster their particular agendas, and to support efforts to render the Supreme Court’s Citizen’s United decision irrelevant through the Consitutional Amendment process.

There is no charge to sign up. While transaction and service fees may apply, there are no bank fees for purchases from stores that accept Visa debit cards or ATM withdrawals at domestic Bank of America ATMs.

Bank of America was famously chastised last year when it instituted a $5 a month debit card fee, a move that prompted many customers to close their accounts, so a statement like “transaction and service fees may apply” should be taken more seriously that this passing remark might suggest. As of yet there has been no indication as to what these fees might be.  Will there be punishing overdraft protection fees? Additionally, employees who switch to the Bank of America debit card and then leave state employment will become subject to the regular bank fees after a 45 day grace period:

Bank of America offers the state of Texas a nominal fee structure for employee paycards. There is no fee for point of sale purchases, which may eliminate some costs to the employee for warrant cashing.

This fee structure remains in effect for 45 days after the employee terminates from state employment or notifies the employing agency that he or she wishes to stop using the paycard. After this time, the fees will be based on standard Bank of America pricing, which will increase the fees for using the card.

45 days may seem like a lot of time though many customers who would like to leave BOA are finding it difficult to untangle their finances from the bank.

Undoubtedly, the  bi-weekly influx of cash from hourly state of Texas employees is quite a coup for the beleaguered megabank. There are almost 400 thousand state employees in Texas, with more than 80 thousand part-time employees who may be less likely to have direct deposit into a bank account, and hence more likely to go with the innocuous sounding TexPayCard through Bank of America. Additionally, the state would like all of  its employees to know that even those of us with direct deposit already set up can choose the Bank of America option and get the pre-paid debit card.

I have been passing around a petition urging the City of Austin to stop banking at Bank of America. The response is amazing – people eager to sign, eager to relate their own horror story about their dealings with this bank. And yet Texas wants to steer its most vulnerable employees, those without bank accounts who live paycheck to paycheck into the jaws of this rapacious institution all in an effort to save on the cost of issuing checks. Yes a pre-paid card is more convenient and possibly less costly than having to cash ones check and pay the service fee, although BOA’s transaction fees have not yet been fully described to employees. But with Bank of America’s record on foreclosures, its unwillingness to work with homeowners on modifications, its lack of lending to small businesses, it’s recent slap-on-the-wrist settlement with the state attorneys-general over fraudulent activity around  its mortgage servicing, you would think Texas might have found a local bank or a credit union to work with.

Even as City Hall was occupied, others worked behind the scenes in committees dealing with such issues of importance to the 99 percent as

• helping homeowners stay in their homes, urging people to move their money out of the megabanks, an effort that has resulted in more than 1.5 million dollars moved to local community banks and credit unions in the Austin area, and urging the City of Austin to move its money out of Bank of America
• Helping East Austin residents have  a say in the planned transformation of two East Austin public school campuses into charter schools
• Marching in solidarity with victims of official brutality in Austin, around the country and the world
• Helping to plant 600 trees to re-forest parkland near Barton Creek
• promoting an end to corporate personhood
• working to end homelessness

While the mainstream media may see an identity crisis in the fact that two people were at City Hall in the middle of the afternoon, Occupy Austin was winning an award for outstanding community activism, and will receive a new media laptop, a sorely needed item now since Occupy Austin’s laptop was destroyed in the police raid last week. As part of the award, Lt. Dan Choi, whose activism and repeated arrests in front of the White House was instrumental in the repeal of the despicable Don’t Ask Don’t Tell,  will visit OA in May.

This is definitely not the portrait of  ”protesters now struggling to find their identity.” It is, however, the picture of a mainstream media steeped in a predictable paradigm – preferring to highlight the sensational while ignoring substance.

Protesting NDAA

It seems fitting that on the same day that free speech was stifled in Austin, Bradley Manning was referred for a court-martial for allegedly providing classified documents to Wikileaks,  including videos of US soldiers murdering civilians, and other documents that are extremely unflattering to the US State Department. But some of the leaked information helped launch the Arab Spring, now heralded by our government. Manning spent almost two years in prison without a court hearing and hence without being charged with any crime, and is a shining example of what could await other American citizens should a future President decide that such detention is acceptable. Manning has now been charged with among other things “aiding the enemy”, and faces life in prison for essentially blowing the whistle on some of our more egregious activities around the world.

As Occupy Austin regroups, it’s instructive to look at the reasons the city has given for evicting the group. These include the cost of the police presence and the fact that many of those 24/7 occupiers are homeless. There has been a large police presence, and those officers have mostly been standing around or leaning on their vehicles. A few times they have carried out the wishes of city officials by informing occupiers of new city rules and of the risk of arrests should occupiers not follow those rules. And on several occasions they have executed those orders, arresting people and charging them with criminal trespass.  The police presence was never requested by Occupy Austin, rather, the city itself is responsible for the hundreds of thousands of taxpayer dollars spent. And yes, there is a homeless population there, and many of them are part of the movement. I thank all of the people who have camped out night after night whether they are homeless or not, because they have kept the physical occupation of the space going for so long. It’s probably worth remembering that any one of us could become homeless in the current economic climate, and so this us versus the homeless distinction is not at all productive.

Occupy Austin’s activities will continue this weekend despite the camping ban, with occupiers planning on convening at City Hall again this evening. More NDAA protests are scheduled for the rest of the weekend. And Occupy Austin will continue to bring attention to the plight of those losing their homes to foreclosure, to the leniency of our government towards the perpetrators of our economic distress and to the City of Austin’s continued relationship with Bank of America. The camp may be gone, but you cannot evict an idea.