New York’s Rebatable Bailout
You can’t make up the following realities in New York State! Note the following series of events driven by the preposterous plutocrats and see if you get steamed.
Greed, power, reckless speculation and theft of other peoples’ money by Wall Streeters collapsed the U.S. economy into a deep recession that started in 2007-08.
These super-rich Wall Street banksters looted and drained trillions of worker pensions and mutual fund savings while nationwide eight million jobs were lost.
Panicked that their overweening avarice was pushing their companies over the cliff, the banksters rushed to Washington, terrified members of Congress with the help of ex-Goldman Sachs CEO turned Treasury Secretary Henry Paulson and propelled the Bush White House into a series of massive taxpayer bailouts and guarantees amounting to trillions of dollars during the last quarter of 2006.
By the end of 2009, the Wall Street welfarists were recording once again record profits and sky-high bonuses. Month after month it became clear that the banks were not lending to small and larger businesses to get the economy moving again—a major reason give for the bailouts.
A good slice of the money went to bonuses, mergers and other empire building by the remaining five giant conglomerate banks. Today these banks are sitting on mountains of cash and many credit-worthy businesses and startups still cannot get loans.
As the Fiscal Policy Institute wrote in April: “Essential services like fire departments and schools, recession-buffering social safety net programs like homeless prevention and senior services, and critical infrastructure systems like hospitals, roads and mass transit all face severe cutbacks.
“But Wall Street is not suffering from the budget catastrophe or from the crash. —The financial industry rang up $61.4 billion in profits for 2009 alone—that is nearly triple Wall Street’s previous record. These are truly windfall profits—they are courtesy of the taxpayer-funded bailout [and federal policies uniquely privileging the big banks with virtually free money] and not because the big banks made money from financing the recovery of American businesses. Never before has Wall Street made so much money from doing so little for economic and job growth.”
Making money from speculation instead of from investment is exactly what the legendary British economist, John Maynard Keynes, warned about almost eighty years ago in arguing for a securities transaction tax.
The conditions where many regular New Yorkers live are grim. Poverty, unemployment, home foreclosures, and small business bankruptcies keep growing.
On the other side of the tracks, the top twenty-five hedge fund managers recorded an average of $1 billion each, or over $80 million each a month in 2009. Quite a quick rebound on the backs of American taxpayers and privileged tax policies.
Low-moderate and middle-income New Yorkers already pay a higher percentage of family income in state and local taxes than do the richest one percent of New Yorkers!
Surprisingly, there is a simple way to eliminate the state deficit and prevent tens of thousands of layoffs and large service cutbacks.
What most New Yorkers do not know is that for about a century there has been a state stock transfer tax on purchases of securities. This year, this tax, similar to ones imposed in 30 other countries, will amount to about $16 billion. Amazingly, since 1979, this tax has been instantly rebated by New York State back to the brokers or clearinghouses who paid it. A 100% rebate every year for the bailed out industry that caused the recession and its immense human damage.
Obviously the stock exchanges and their brokers wield big political power. Flush with arrogance, bailouts and profits, they have no shame. So after blocking a tax on those unconscionable bonuses that outraged so many Americans, the securities industry has made sure that neither the Democratic nor Republican candidates for Governor utter a peep about retaining this $16 billion in tax revenues to get the state out of its dire straits.
One man, Howie Hawkins from Syracuse, NY, is challenging both the big boys on Wall Street and the duopolists’ candidates. He is the Green Party candidate for Governor, nicknamed the Green Hornet. Pollinating truth and justice across the State, this ex-Marine, author, long-time citizen advocate, working blue collar teamster and public interest thinker, challenged Mr. Cuomo’s self-imposed taboo:
“Why is Mr. Cuomo, the anointed front runner, hiding the Stock Transfer Tax from the public when it is an obvious way to bridge the state budget deficit? Why does he rule out higher taxes on the rich when they have more money than ever, why won’t he make them pay their fair share, when they’ll still be rich after paying their fair share?”
All the politicians in Albany act like we’re out of money and debate over what services to cut, all the while refusing to tell New Yorkers about the $16 billion they hand back to Wall Street speculators,” he added.
Mr. Cuomo is a recipient of campaign contributions from hedge fund managers.
Take any poll. Betcha New Yorkers overwhelmingly support Mr. Hawkins’ position (see: www.howiehawkins.com). Unfortunately, the two major parties predictably exclude him from any debates this fall.
If you are a New Yorker, and after reading this you are less indignant than you would be were you overcharged by a cab driver or were hurled a racist or ethnic slur from some passerby, it is unlikely you’ll hustle up a neighborhood or workplace petition to demand that your lawmakers in Albany legislate keeping that $16 billion and all the jobs that can be saved with that revenue.
My guess is that if a million New Yorkers sign such petitions in the next three weeks and talk it up where they live in city, town and countryside, they’ll win. You’ll also signal that you’re ready to jettison your political servitude and assert the sovereignty of the people as expressed in our Constitution’s preamble—”we the people.”
If you can’t wait, call your Albany legislators at 518-455-2800 (State Senate) or 518-455-4100 (State Assembly) to see when they will be near your town during this summer. Go and give them two earfuls and demand that they commit.