Author Archives: Matt Stoller

Matt Stoller is a fellow at the Roosevelt Institute. You can follow him on twitter at http://www.twitter.com/matthewstoller

In a hearing last week titled “Examining the Settlement Practices of U.S. Financial Regulators”, various regulators tried to justify their practice of settling with financial firms and not requiring them to admit wrongdoing. In that hearing, Federal Reserve General Counsel Scott Alvarez, stated that only seven of the roughly one thousand enforcement actions taken in the last decade were resolved without consent.

As our political system sputters, a wave of innovative thinking and bold experimentation is quietly sweeping away outmoded economic models. In ‘New Economic Visions’, a special five-part AlterNet series edited by Economics Editor Lynn Parramore in partnership with political economist Gar Alperovitz of the Democracy Collaborative, creative thinkers come together to explore the exciting ideas and projects that are shaping the philosophical and political vision of the movement that could take our economy back.

Just beneath the surface of traditional media attention, something vital has been gathering force and is about to explode into public consciousness. The “New Economy Movement” is a far-ranging coming together of organizations, projects, activists, theorists and ordinary citizens committed to rebuilding the American political-economic system from the ground up.

The broad goal is democratized ownership of the economy for the “99 percent” in an ecologically sustainable and participatory community-building fashion. The name of the game is practical work in the here and now—and a hands-on process that is also informed by big picture theory and in-depth knowledge.

On Sunday, roughly one thousand people from liberal community organizing group National People’s Action showed up at Tim Geithner’s house to ask that he investigate the banks.  “Are you with the people”, asked these activists.  In response to this exceptionally mild pressure, the administration and New York “Attorney General” Eric Schneiderman have decided that they have no choice but to do a bit more PR around the task force.  They have doubled its size, and they have appointed a coordinator.

“There was a kind of inflection point during the five-year period between 1997 and 2003 — the late Clinton and/or early Bush administration — when all the rules just went away. You went from a period, a regime, where people did have at least some concern about going to jail, to a point where everything is legal, and derivatives couldn’t be regulated at all and nobody went to jail for anything. And looking back I would say that this period definitely started under Clinton. You absolutely cannot blame this on George W. Bush.” – Charles Ferguson of Inside Job

“I never had any money until I got out of the White House, you know, but I’ve done reasonably well since then.” Bill Clinton

On December 21, 2000, Bill Clinton signed the last law of his Presidency, a bill known as the Commodities Future Trading Act that deregulated derivatives and set the stage for the financial crisis.  Two months later, on February 5, 2001, Clinton received the first payment of what would become an extremely lucrative revenue stream for him, $125,000 for a speech paid by Morgan Stanley in Clinton’s new home of New York City.  A few weeks later, Credit Suisse hired Clinton for another speech, at $125,000, also in New York.   Clinton does these speeches on top of offering policy advice, writing books, stumping for political candidates, and running a global foundation.  He’s now worth something on the order of $80 million (or possibly much, much more).

This is by Yves Smith, cross-posted from the New York Times Room for Debate…

Preventing blow-ups like the JPMorgan “hedge” that bears no resemblance to any known hedge isn’t difficult. What makes preventing it difficult is that banks that exist only by virtue of state-granted charters — and more recently, huge transfers from the public — have persuaded public officials and regulators that they have a God-granted right not just to high levels of profit but also high levels of employee and executive compensation.

Matt Stoller is a fellow at the Roosevelt Institute.  You can follow him on twitter at http://www.twitter.com/matthewstoller

Austerity doesn’t just lead to unemployment and misery, it can also lead to the emergence of “swamp things” into positions of power.  Take the situation in Greece, which until recently was a wealthy Western democracy with a relatively stable political system.  After five years of depression, voters in Greece just fired their equivalent of the Democrats and Republicans, and replaced them with anti-bailout groups, mostly on the left (Syriza and Communists), but also with the neo-Nazi group Golden Dawn on the right.

By Marshall Auerback, a hedge fund manager and portfolio strategist. Cross posted from New Economic Perspectives

Given the German electorate’s long standing aversion to “fiscal profligacy” and soft currency economics (said to lead inexorably to Weimar style hyperinflation), one wonders why on earth Germany actually acceded to a “big and broad” European Monetary Union which included countries such as Greece, Portugal, Spain and Italy.

Matt Stoller is a fellow at the Roosevelt Institute. You can follow him on twitter at http://www.twitter.com/matthewstoller

The Lehman Brothers bankruptcy is perceived of as the 9/11 of the financial crisis, the moment where liquidity problems that had been bubbling since late 2006 turned into a full-fledged panic and then economic collapse. The question American elites are pondering is, will a Eurozone break-up, or even Greece leaving the Euro, cause another such moment? Ben Bernanke has argued that Greece leaving wouldn’t, since domestic banks have reduced their exposure to problem countries. Paul Krugman agrees, and in a recent interview on Bloomberg, laid out his case.

Matt Stoller is a fellow at the Roosevelt Institute.  You can follow him at http://www.twitter.com/matthewstoller

Today, to approximately no one’s surprise, the Republicans in the House Financial Services Committee are going after the Consumer Financial Protection Bureau.  Congressman Barney Frank and Brad Miller, though, have introduced something pretty interesting into the mix.  They have struck back by using the same attacks the Republicans are making against the CFPB on the bank-friendly regulators at the Office of the Comptroller of the Currency and the Federal Reserve.  Specifically, Frank and Miller have proposed to make the OCC and the Federal Reserve, the most important bank regulators, subject to Congressional appropriations.  Right now, those two agencies fund themselves through money printing (the Fed) or assessments on the banks (OCC).  What Frank and Miller are doing would be a major step forward for democratic accountability over our bank regulators.

One of the least-recognized and most common electoral strategies by the Republican Party is to run elections around left-wing themes.  For instance, in 2010, much of the ad spending by outside GOP-aligned groups, as well as explicit party communications, focused on health care.  The Republican attack ads didn’t center for the most part on the […]

Happy tax day!  Cross-posted from Republic Report.

Here’s a chart of Intuit’s lobbying expenditures in Congress, courtesy of Open Secrets. I suspect that some of that nine million dollars of lobbying by that company since 2008 has gone to making it more annoying for you and me to file our taxes.

About a month ago, I met an extremely liberal and political couple from upstate New York.  I asked the wife whether she likes New York Attorney General Eric Schneiderman, expecting to hear something along the lines of “Yeah he’s great” or something like that, the way that traditional partisans act.  I had spent a bit of time at New York City Democratic events, and most people there respect Schneiderman because of his work getting that task force on financial fraud announced.  I thought I’d hear something similar.  Instead she said, “Oh is he the guy who is sending my husband scary letters about his nonprofit?”

By Mark Ames, the author of Going Postal: Rage, Murder and Rebellion from Reagan’s Workplaces to Clinton’s Columbine. Cross posted from Consortium News.

This past Thursday, a Modesto, California, man whose house was in foreclosure shot and killed the Sheriff’s deputy and the locksmith who came to evict him from his condominium unit. Modesto authorities responded by sending 100 police and SWAT snipers to counter-attack, and it ended Waco-style, with the fourplex structure burning to the ground with the shooter inside.