How Should The Occupy Wall Street Movement Proceed And To What End?
How Should The Occupy Wall Street Movement Proceed and to What End?
I, like many Americans, have been watching the Occupy Wall Street movement (OWS) evolve over the last few months with great interest. They began as a seemingly ragtag group of demonstrators but have grown into a very influential movement. OWS has demonstrably raised awareness regarding the growing wealth disparities and corporate malfeasance within the United States and the world. Their commitment to this cause in the face of inclement Winter weather, a paucity of amenities, and the growing police crackdowns around the country has been nothing short of inspirational. I myself have wished that I could support them in person on Wall Street. After all, I worked there for 27 years before falling victim to the financial chicanery which took place in those institutions. Now I work difficult hours within the retail field in New Jersey far from Wall Street. My current work schedule is long and tiring making my attendance at the demonstrations in downtown Manhattan problematic at best. I have wanted to support them in some way and have struggled with how to accomplish that.
Several months ago I wrote a Hub outlining the causes and possible remedies regarding the financial meltdown of 2008. Now I would like to outline the goals and issues that I feel the OWS movement should emphasize to further their cause and to maintain their relevance. The goals and issues I will outline are ones I have heard and read the demonstrators elucidate from time to time along with others I consider vital to our nation. The first three that I will define are ones that I feel are at the core of the movement's ideals. They are the three main foundation issues that should drive the movement to achieve their goals. These issues are the increasing wealth disparity between the rich and poor, the flood of corporate money into our elections and governments, and the increasing size and lack of regulation of our financial institutions.
Finally, I will discuss three less central but still very important issues that I feel that OWS should incorporate into their movement. These are affordable universal healthcare, alternative renewable energy, and the increasing threat to our industrial and financial regulatory framework. These three issues come under my umbrella of improving the American quality of life. Hopefully I will have enunciated a clear program of goals and issues that most citizens can rally behind by the end of this article.
The most common chant heard at OWS gatherings is that the upper 1% of Americans in wealth are controlling and harming the lives of the other 99%. One way they do this is by influencing governmental policies and legislation that allows these disparities to grow. These wealthy individuals along with Corporate America wield this influence through intense lobbying and massive election campaign contributions. The OWS movement is right on target with this issue.
The main area where the 1% have engineered this increased wealth disparity is by influencing tax policy on Capitol Hill. The income tax rates on the wealthy have been falling steadily since the Reagan administration. They dropped from 70% in 1980 to 50% by 1982. They dropped again to 38.5% in 1987 and then to 28% in 1988. The theory behind the last two cuts was that the elimination of most tax loopholes would make up for the lost revenue of the rate cuts. That never fully materialized and the loopholes for the wealthy and corporations soon reappeared. Eventually these rates rose to 31% in 1991 and 39.6% in 1993 to close the massive budget deficit. This was a much fairer rate than those instituted during President Reagan's terms. The budget was balanced ten years after these rate increases were installed.
This occurred not only because of the rate increases but also because the economy became very robust during this period generating much greater tax revenue. This disproved the conservative theory that higher tax rates always hurt the economy. These rates remained in effect until 2003 when the Bush tax cuts were fully implemented. Capital gains and estate tax rates were also slashed dramatically leading to a reverse Robin Hood effect. This was the most massive wealth shift from the poor and middle classes to the wealthy in United States history.
In the meantime, the Social Security income threshold has remained at $106,800 for more than two decades. This far exceeds the inflationary growth of this period further enriching the upper classes who pay much less proportionately into this fund. These trends need to be reversed back to at least the Clinton era rates. The Social Security income threshold must be increased by a large amount to ensure that this essential program remains solvent for our retiring baby boom generation. Elderly retirees have given vast amounts of their income into this fund over the course of their many years of employment. We must preserve this program by increasing revenue not cutting benefits.
The largest threat to our political system and American way of life resides in the exploding influence of unlimited and anonymous election campaign funding. The United States Supreme Court ruled that corporations, unions, and all other organizations have the same "freedom of speech" rights as all individual United States citizens when they issued their Citizens United decision. The influence of money on our electoral process had already proven to be enormous even before Citizens United. That ruling turned more than thirty years of campaign finance law on its ear. Now any organization can receive and utilize unlimited amounts of contributions for campaigning for or against any candidate. The only limitation is that these organizations cannot coordinate in any way with any of the candidate organizations.
The campaign spending during the 2010 elections, the first after the Citizens United decision, shattered all previous records. Corporations and wealthy Americans poured huge amounts of money into Republican campaigns all over the country. Many of the Democratic candidates were outspent 2-1. The industrialist Koch Brothers had been at the head of their own conservative group long before the Citizens United decision. They funded the Citizens United organization with the aim of tearing down the existing campaign finance restrictions so they could extend their political influence even further. It worked brilliantly. They now fund many right wing organizations including many Tea Party groups. Their funding was essential in creating that movement.
They also fund a conservative policy writing organization called the American Legislative Exchange Council (ALEC). Newly elected Republican legislatures all around the country have been passing new legislation written by ALEC. These new laws have included lower corporate taxes, lowering or eliminating regulations, curtailing municipal union rights, and placing restrictions on voting groups that lean heavily Democratic. It is obvious from all of these conservative corporate machinations that action needs to be taken to restrict this unlimited and mostly anonymous campaign financing. They are corrupting our democratic electoral system as well as our governments.
The only way I can see us effectively accomplishing this goal in our current judicial environment is to actively push for a very strong campaign finance Constitutional amendment. The Supreme Court in the Citizens United decision declared that corporations, unions, and other organizations have the same rights such as freedom of speech as individuals. This is the personhood issue. A new Constitutional amendment should state from the outset that this premise is false. They should continue from this point and state that all campaign financing should be regulated and fully disclosed from the outset. Political donors are revealed the year after an election under our current system. This is too late for voters to make an assessment regarding the influence these donors have and whether it is positive or negative. A public financing mechanism should also be included along with strict limitations on campaign contributions. This goes for both individuals and for all organizations. All contributions would be fully disclosed with easy and quick access provided to the public with this information.
No positive changes will be possible for the governance of this country without the elimination of these unlimited campaign funds. The upper 1% in the United States now dictate policies because of these contributions. True change for the other 99% will not occur without an amendment cancelling out the Citizens United personhood ruling. This will bring sanity back to our elections and subsequently our governments.
The third major issue that I feel the OWS movement should adopt is the strengthening of the regulation of our financial markets while also downsizing our "too big to fail" financial institutions. The sheer size and interconnectedness of these institutions constantly threaten our economic security. The 2008 financial meltdown is the prime example of this condition.
Financial institutions were given virtual carte blanche in the late 1990's to take any risks they wished while also growing to monstrous sizes. This occurred by way of repealing the section of the Glass-Steagall Act that separated investment banks from commercial banks. Banks were now allowed to invest both their clients' money as well as their own in the stock market and other markets. Soon they were investing heavily with declining degrees of risk management as their profits grew steadily.
Financial institutions also created new and much more complex security instruments such as derivatives to create even greater profits. Over a trillion dollars were invested in these instruments with very little knowledge of what their makeup was and what risks were attached to them. In actuality, they were little more than bets on how certain market segments would move. They were operating as if they were in a casino. The mortgage securities derivatives were cashed in when the housing market crashed to the detriment of these financial institutions.
The only thing our federal government could responsibly do was to bail them out to prevent a catastrophic collapse of our entire economic system. This would most certainly have led to another "Great Depression". We have effectively become the backstop and the insurance policy for these financial institutions. It is about time we held them responsible for proper risk management.
We need a renewed separation of commercial and investment banking, the elimination of predatory banking practices, and a return to smaller more manageable institutions. The Dodd-Frank Reform Act of 2010 was a good first step to implementing common sense reform to our financial system. Unfortunately it was greatly watered down to secure wavering Senate votes. The banking industry lobbied hard for this moderation and is still working behind the scenes to water down or eliminate this legislation. It is reprehensible that they accepted huge bailouts to survive and now want to continue on as they had before the financial meltdown.The OWS movement should continue to place a spotlight on this abomination and advocate for much stronger regulations and smaller institutions.
There are three other issues that I feel the Occupy Wall Street movement should incorporate as their causes even though they are not at the core of the movement. The first is universal healthcare. Our current healthcare system is incredibly unfair and inefficient. Employment is required for most Americans to obtain affordable healthcare insurance. This is very inhumane and as a nation we should be weaned off this system as quickly as possible. The new Affordable Healthcare legislation passed in early 2010 is an important first step though it does not go far enough. OWS should work feverishly to advocate for universal healthcare while also working to strengthen this new legislation. They should also argue for the weakening of the healthcare insurance companies that make huge profits while limiting healthcare options and declining claims. OWS should also demonstrate for the creation of an entirely new results oriented system instead of the current dysfunctional fees for tests and procedures process. This would place a strong curb on the skyrocketing costs of healthcare by curtailing the plethora of unnecessary tests and procedures which are only ordered to generate revenue for the healthcare provider. Healthcare is one of the largest industries in our economy today and is growing rapidly due to the aging of the baby boom generation. Controlling its costs and covering everyone is essential to the revival and sustainability of our nation's economic health.
The second ancillary issue for the OWS movement to adopt is the need for America to convert from our current fossil fuel energy industry into one run on alternative renewable energy sources. The supply of fossil fuels in the world is depleting rapidly. This is occurring just as China, India, Brazil, and other developing countries are rapidly growing their economies. This is similarly expanding their energy needs. The results will be oil and gas prices rising prohibitively threatening the strength of our economy. These fossil fuels are also destroying our environment and promulgating global warming . Both our economic and physical survival are at stake. I feel the OWS movement should strongly urge our government to fund research into all promising alternative renewable energy options.They should also encourage all of our governments to institute cleaner industry and automobile emissions standards.
Finally, the OWS movement should fight the growing trend of industry deregulation at every turn. Corporate leaders have been pushing heavily for deregulation over several decades. They are now able to use unlimited money to accomplish this goal by funding independent Political Action Committees (PAC) to help elect candidates that will be friendly to their deregulation desires. This is due to the aformentioned Citizens United decision. This is in addition to the massive amounts of lobbying money they already use to influence legislators. A large amount of candidates were elected this way in 2010 by way of independent corporate money. One of the major goals of the Koch Brothers, the leading corporate organizer and donor, is the elimination of as many industry regulations as possible. They feel that they know how best to run their industries and in turn what is best for America. Corporate America has already wreaked tremendous damage upon our country through environmental degradation, product defects, and numerous financial shenanigans. Loosening or eliminating the regulations that already exist would be madness. Strengthening them is imperative to the environmental and economic health of the United States.
The Occupy Wall Street movement has already made a strong impact on the political psyche of the American people. Where will they go from here? They are strengthening their online capabilities to connect with supporters and the public. Will they also combine this with a more cohesive message? My opinion is that they will have to develop one for the movement to significantly advance further. They have successfully brought to the forefront the issue of the gross wealth disparity between the wealthy 1% of our country and the rest of us. They need to continue to hammer this point across while fleshing out the issue with solutions to rectify the problem.
Another critical issue that affects all aspects of our governance and economy is the explosion of campaign finance money in our elections due mostly to the Citizens United ruling. There is no way for OWS or any other group to change the vast inequity of the distribution of wealth in this country or curtail corporate corruption without regulating campaign finance. OWS must press for a very strong Constitutional amendment to limit this corporate financial influence.
The third major issue is highlighted by the "Occupy Wall Street" movement name. They need to continue to focus like a laser on the reckless and predatory activities within the financial industry. Wall Street's practices of bundling mortgages and writing derivatives fueled the housing boom greatly enriching their bottom lines. They also misrepresented many of these securities leaving their clients holding the bag when the housing market crashed. The OWS movement needs to continue to hammer away at this issue while advocating for much stronger regulations along with smaller financial institutions.
Finally, the OWS movement needs to support the three quality of life issues I stated as important but not core issues. Universal healthcare, alternative renewable energy, and the strengthening of industry regulation are necessary for all Americans. Our nation's physical and economic health hinge on our success in achieving victories within these sectors.
My belief is that if the Occupy Wall Street movement adopts and sticks to these issues and goals, they will significantly extend their influence within the American populace and electorate. The movement has the potential of changing both the content and the character of our political system. My hope is that they do not waste this opportunity by presenting a fractured and sometimes confused message. I believe they are organizing now to do exactly this and they will come out in a big way this Spring. Our country needs their message, enthusiasm, and dedication. I am rooting for them and I will try to support them more substantially in the future. We all need to do so. The United States is at a critical juncture. We can follow the right wing Republicans into a deeper era of corporate cronyism and anti-intellectualism or we can look to the future and follow OWS as they attempt to make this country a better place for we the 99%.