Tuesday, October 18, 2011

A Tale of two Cities

The First Amendment or private police

By Mike Krauss
Bucks County Courier Times

Occupy Wall Street is moving into its second month. From the outset, the police in New York City took a decidedly unfriendly posture to the demonstrators: pepper spray, billy clubs pushing and shoving, trying to restrain the movements of the demonstrators and lots of arrests.

The mayor of New York swung into action and accused the Wall Street demonstrators of trying to cripple the city’s economy.

“What they’re trying to do is take the jobs away from people working in this city.”

This is of course a ludicrous claim. If anything, as people travel into the city to participate and the media begin to focus, vendors, hotels, restaurants and many other merchants are selling more of their goods and services.

But this is not the kind of convention his honor wants to host.

Of course, the mayor may not have been thinking of the jobs of hot dog vendors, deli owners and local merchants. He may have been thinking about the jobs of bankers. But if so, his worry is unfounded.

The protesters don’t want mass layoffs of bank clerks. They just want to see some of their bosses go to jail.

In Philadelphia, where Occupy Philadelphia was launched only a week ago, city leaders took a different approach. A spokesman for the mayor set the tone, telling the media, “They (the protesters) have been law-abiding; there have been no arrests or citations; they’ve controlled their site very well; they have cooperated with police.”

He continued, “They’re exercising their right to free speech, and they’re going about it in a very mature way.”

Philly Mayor Michael Nutter visited the die-hards who slept out in the open the first night — at 1:30 a.m.

Philadelphia newspapers reported that Police Commissioner Charles H. Ramsey “has directed his officers to work with demonstrators and assist with marches. He emphasized that officers are bound to protect the demonstrators’ right to protest peacefully.”

Ramsey has also had the First Amendment read at roll calls and periodically over the police radio system as a reminder.

How to explain the difference in the two cities?

One reason may be that Philadelphia is the place where the “inalienable” rights of the people were first declared, and then protected in the Constitution, and it appears are still taught in the schools.

Another may be that the police in both New York and Philly report to the mayor, and they are very different men. The mayor of New York City, Michael Bloomberg, is a billionaire who made his billions — and goes on making them — providing business services to Wall Street. He has a major Wall Street firm as business partner.

But in a recent article in the journal Counterpunch, 20-year Wall Street veteran Pan Martens reported a more troubling explanation for the aggressive behavior of the New York City police: they’ve been bought.

Oh, I don’t mean New York cops are taking illegal bribes to beat up demonstrators. This is America. The bribes have been legalized. The cops have been hired by Wall Street, in a program started by former NYC Mayor Rudi Giuliani.

Martens reports, “It’s called the Paid Detail Unit and it allows the New York Stock Exchange and Wall Street corporations, including those repeatedly charged with crimes, to order up a flank of New York’s finest with the ease of dialing the deli for a pastrami on rye.”

According to Martens, for $37 an hour, the New York Stock Exchange, Goldman Sachs and other undisclosed firms will have paid out more than $11 million by the end of the year to hire cops with uniforms, badges, guns and the power to arrest.

Not every member of the force is happy with the arrangement. One officer described it on a website as officers “... working for, and being paid by, some of the richest people and organizations in the City, if not the world, enforcing the mandates of the private employer, and in effect, allowing the officer to become the Praetorian Guard of the elite of the City.”

One hopes that is what most of the officers think, but $11 million in hard times is bound to win friends and influence people.

So it appears that the “White Shirt” NYC cops who have been all over the demonstrators, as opposed to the familiar Blue Shirts, may not be “supervisors” as has been claimed, but are part of a private gang.

And they are being used by Wall Street today exactly as Wall Street used paid thugs at the turn of the past century to break up striking miners and steel workers.

So, hats off to the Honorable Michael Nutter, Mayor of the City of Philadelphia, his commissioner of police, Charles H. Ramsey, the men and women of the force and, above all, the people of the City of Philadelphia and the Occupiers for providing the nation with a much needed civics lesson.

Fed up with a government that serves, protects and defends only established wealth and privilege, they have taken matters in their own hands; but unlike the barons on Wall Street and their allies, they have not taken the law into their own hands.

Mike Krauss is chairman of The Pennsylvania Project, a former officer of Bucks County and Pennsylvania government and an international logistics executive. Reach him at www.papublicbankproject.org.

Saturday, October 15, 2011

Death of Democracy?

The concentration of wealth, and the destruction of the middle class

By Mike Krauss
Bucks County Courier Times

27 September 2011

The changes have been taking place for 40 years, but so gradually that the American middle class was not alarmed. People are like that. We can adjust to enormous change if it occurs gradually.

So it crept up on the American middle class: 40 years of flat wages, expensive credit substituted for income, two wage earners and multiple jobs to keep heads above water, jobs off-shored and American manufacturing decimated, wages further depressed by an over-supply of labor created by unchecked and mostly illegal immigration, taxes that favored the wealthy, banking laws and deregulation that allowed the finance industry to get a stranglehold on the American economy and government.

It is as if the American house had been infested by termites, but nobody noticed until the roof began to fall in. Suddenly, we can see how the house has been ravaged.

Poverty is rampant, millions of the middle class pushed down the ladder which generations expected to climb. Fantastic wealth has been concentrated among the few as never before.

The massive damage done is expressed in a chart recently published with surprising candor by the Federal Reserve and labeled “Owners Equity in Household Real Estate.”

It shows that in 1951 Americans held about $250 billion in home equity; about the time the GI Bill began not only to put veterans through college, but also to support the home ownership which created the modern suburbs and middle class.

By the time of the 2008 Wall Street crash and bail out, that equity had grown to almost $14 trillion, its growth virtually immune to the periodic recessions in the U.S. economy.

Even adjusted for inflation, that is a lot of wealth and represents what post World War II Americans achieved: the creation of the greatest and most broadly shared prosperity the world had ever seen — the rise of the American middle class.

With the crash, home equity fell off a cliff and has now been cut more than in half. It is falling still. Those Americans who owned most of that real estate, the middle class, have lost about $7 trillion of their wealth.

That wealth will not disappear. It will be transferred to the already wealthy. The new American way.

An industry trade group, Realty Trac Inc. reports that the sale of foreclosed homes accounted for 31 percent of home sales in the last quarter. These homes were not purchased by the poor, the unemployed or the struggling middle class. They were purchased — at bargain basement prices — by the already wealthy. Why would they do such a thing in a depression?

Because the economy only moves one of two ways: up or down. And when this depression ends, home prices will once again go up, and these assets will make the wealthy even wealthier.

Meanwhile, these homes will be rented. And millions of once middle class Americans will go from homeowners to home renters, and their wages will not be invested in an asset, but instead will go as rents to the wealthy.

Further, the Obama administration has floated the idea of ending the home mortgage interest deduction in the tax code, and providing rental assistance.

So the middle class taxpayer who still owns a home and pays taxes will lose that deduction, and be taxed to provide the money to be paid as rents to the new suburban slumlords.

Middle class Americans are experiencing a disaster of historic proportions. It was entirely man made. But, what to do about it?

A place to start is to stop listening to the prevailing narrative that Washington is dysfunctional and can’t get anything done because of partisan wrangling. That is a false and intentionally misleading narrative from a captured national media, whose owners fear the day the American middle class wakes up.

Washington gets plenty done. Doing nothing is a policy, the policy of keeping things the way they are.

Americans must wake up to the fact that high unemployment, home foreclosures, and out-of-control militarism, the destruction of the middle class and the legislation of every device known to man to preserve, protect and defend the wealth of the wealthy are the intended policies of the federal government.

The American political establishment is not bumbling. It is bought.

Political power flows from wealth. When the wealth of a nation is shared among the many, when there is a middle class, democracy can flourish. When wealth is concentrated, democracy dies.