Robert Reich discusses corporations as people

“Corporations are not ‘people.’ I’ll believe corporations are ‘people’ when Texas and Georgia execute the next corporation…”

Robert Reich (Reference: 6:00 on the above video) Billionaire hedge fund operator Raj Rajaratnam was sentenced recently to 11 years for insider trading in a Manhattan federal court. Mr. Rajaratnam was convicted by a jury of 14 counts of insider trading for illegally conspiring to obtain and using insider information from individuals at Goldman Sachs, among others. Prosecutors argued that Rajaratnam made over $74 million from his scheme. While some might praise the effort to convict Mr. Rajaratnam, how did the folks who he bribed or whatever fare? Why does the name Goldman Sachs keep coming up in all the Wall Street scandals? Did the government get anything from Goldman Sachs or any other bailout recipients for the money used to keep these operations alive? Just what the hell is Goldman Sachs still doing in any investment banking business at all?  Goldman Sachs and 3 other banks are still trading in the risky derivatives which brought down the financial markets in 2008. Goldman and the other 3 banks hold some 95% of those contracts. [More . . . ]

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Senate to vote on net neutrality next week

The U.S. Senate is expected to vote next week on one of the most important issues that most folks aren't well tuned into: Net Neutrality. If this vote goes badly, or if Barack Obama fails to veto the result, that will be the end of the Internet as we know it, because the Internet will become much more like cable television, with corporate controlled options regarding permitted websites and acceptable software and devices. Free Press is offering a basic Q & A on net neutrality here.

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Red Cross seeking donations

I'm in Chicago for a consumer law conference. While walking to the conference site a young woman approached me on the sidewalk, asking me to donate to the Red Cross. I told her that I'm not interested, because too much of the money I would donate would go to over-paid executives. She quickly responded that the head of the Red Cross only makes a bit more than $600,000. I told her that this was outrageous. She asked, "So you would never give to a charity where the person in charge makes $600,000?" I said, "Never." The Red Cross is not alone in paying huge salaries to its executives.   Here is a list of the salaries of some of the executive salaries of some of the biggest charities in the United States.   Many of these charity leaders earn less than $200,000. I know a lot of teachers who work every bit as hard as any executive, yet they are paid a pittance compared to $600,000. I know many people who believe in a cause enough to work untold hours for the cause for no pay at all. It seems to me that charities ought to work harder to find leaders who believe in the cause enough that they will do it for outrageous salaries. For comparison, the salary of members of Congress is $174,000 per year. A justice on the United States Supreme Court earns $223,000 per year. Ralph Nader lives off of $25,000 per year.  The average chief executive (charity and non-charity) in the United States earns less than $300,000/year.

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Succinct bio of Robert Rubin

At Truthdig.com, Robert Scheer offers the following condensed bio of Robert Robin, one of the architects of too-big-to-fail banks. It puzzles Scheer that, while Bernie Madoff is sitting in prison, Rubin, whose actions have caused far more damage than Madoff, remains out and about, after having served as an Obama advisor. Here's the an excerpt from the bio:

Rubin’s tenure atop the world of high finance began when he was co-chairman of Goldman Sachs, before he became Bill Clinton’s treasury secretary and pushed through the reversal of the Glass-Steagall Act, an action that legalized the formation of Citigroup and other “too big to fail” banking conglomerates. Rubin’s destructive impact on the economy in enabling these giant corporate banks to run amok was far greater than that of swindler Bernard Madoff, who sits in prison under a 150-year sentence while Rubin sits on the Harvard Board of Overseers, as chairman of the Council on Foreign Relations and as a leader of the Brookings Institution’s Hamilton Project. Rubin was rewarded for his efforts on behalf of Citigroup with a top job as chairman of the bank’s executive committee and at least $126 million in compensation. That was “compensation” for steering the bank to the point of a bankruptcy avoided only by a $45 billion taxpayer bailout and a further guarantee of $300 billion of the bank’s toxic assets.

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Americans are moving their money away from banks

Last year I moved my money. I made the move in response to a campaign started by Arianna Huffington at the end of 2009.  She urged that we stop supporting big banks (especially too-big-to-fail banks) and start supporting local banks and credit unions. I moved my money to a credit union (I chose Gateway Metro Credit Union), and I've never looked back. Credit unions are non-profit; they are service oriented, offering low fees or no fees. My new credit union offered me great customer service. In my city of St. Louis, credit unions offer you the use of each others' ATMs without fees. When I asked what the minimum balance was for my new checking account, the woman from the credit union said, "There is no minimum balance." I had been struggling with my bank for 3 weeks to set up an HSA savings account, for which it was going to charge me $25/year. The credit union had the account set up in 15 minutes and is not charging me any fee. The credit union offers online check paying and other account services comparable to those offered by the bank I formerly used.  I am much happier doing my banking at a local credit union, especially thanks to the superior customer service. Bottom line: If you are still keeping your money at a big bank, there are many good reasons for moving it. Think about taking it local, especially to a credit union. It turns out that after some of the big banks starting imposing new fees last month, there has been a mini-stampede away from the big banks and toward credit unions:

The Credit Union National Association (CUNA) reports that a whopping 650,000 Americans have joined credit unions since Sept. 29 — the date that Bank of America announced it would start charging a $5 monthly debit fee, a move it backed down on this week. To put that in perspective, there were only 600,000 new members for credit unions in all of 2010. “These results indicate that consumers are clearly making a smarter choice by moving to credit unions where, on average, they will save about $70 a year in fewer or no fees, lower rates on loans and higher return on savings,” said CUNA President Bill Cheney.

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