Would 'Bank Transfer Day' make any difference in anything?

Coming up on Nov 5th some activists are trying to organize a nationwide "Bank Transfer Day" where people would transfer their money out of big banks, and into credit unions.  Why on Nov 5?  It's Guy Fawkes Day, which is related to a 1600's era Englishman who wanted to blow up the English Parliament and later inspired a comic book (and even later a movie) named V for Vendetta.  Between the Fawkes mask in the Bank Transfer Day logo, and the choice of day, one can assume their intention is destructive, to cause some harm to the banking system by removing money from the banks.

When we deposit money in a bank account it increases the asset base of that bank.  That is, deposits in bank accounts are carried as assets on the bank's books.  Bank's lend their assets (the money we deposit in the bank account) and earn revenue based on interest (and bank fees) they charge from the loans.  Our money deposited in big megabank accounts increases the power of the megabanks.  If we instead deposited money into credit unions, it would shift power from big megabanks to smaller local banks.

The Bank Transfer Day Facebook page talks about this, the difference between banks and credit unions, and some recent bank reform laws.  Banks are for-profit companies whose Board of Directors are appointed by shareholders, where Credit Unions are non-profit companies whose Board of Directors are selected from members, that is the account holders.  This probably means, as the BTD people suggest, that decisions running Credit Unions are more closely aligned with account holders, than decisions running the big banks.

Maybe we'd have a better world if the credit unions were stronger and the big banks were weaker.  But … the BTD crew is inciting us into committing a mass run on the bank, which would crash the system.  Or are they?  They say that's not their intention, nor is their intention to crash the system.  A mass withdrawal of money from banks seems like the very definition of a run on the banks, and as we know this is something which can cause big havoc.  The Great Depression was caused when a stock market collapse (1929) spooked the population, who tried to withdraw their money (run the banks), to keep the money at home, causing the banking system to have no money and therefore collapse.

That's what they're risking with this call for action - crashing the banks.  The BTD crew suggests in their Facebook page notes this isn't a true run on the banks like what caused the Great Depression.  Rather than keep their money at home, the instructions are to switch from big banks to credit unions.  Money will still be in the banking system, but instead with organizations that are friendlier to real people than the big banks.

What I'm wondering is whether it will make a difference?

This reminds me of boycotts ...  Boycotts tend to have a short blip of an effect, you avoid buying gasoline from the particular brand for a day or a week or whatever, and eventually go back to that brand.  In this case the big banks have been rightfully tarred with negativity due to the 2007-8-9 financial collapse and the mortgage crisis.   Would transferring bank accounts have a similarly short term effect?

I rather doubt there will be very many people switching their bank accounts.  Banking relationships are more permanent, with longer ranging effects, than gasoline purchases.  Right?  There's all sorts of things connected to your bank account, automatic deposits, automatic payments, credit cards, and so on.

The major difference would be a relocalization of banking relationships.  A criticism some have of the current financial system is the siphoning of profits out of a local area to the pockets of remote business owners.  This depletes the financial strength of a given location.  Relocalization calls for buying from locally owned stores, and using a locally owned bank, and maybe even taking the step of creating a local currency.  The point of that is to keep profits within the local community, keep money circulating locally, keeping financial strength in your local place.

Relocalization of this sort is a larger thing than a blip of an event riding the coat-tails of a protest movement that might fizzle out once the snow starts falling.  Relocalizing the economy is a long term large scale project of education and action.

In any case here's a few videos:-

Fox News talking about "Should Wall Street be Worried"?  Towards the middle they start getting riled up about how Dodd-Frank is preventing the banks from doing things, and over the Government acting to Prevent a Bank from "investing their own capital" in whatever they want.  Uh..  Do they not recall how the financial system recently collapsed?  Have banks been reduced to utilities who must follow the edict of government?  That's how banks used to be run, with strictly laid out interest rates that gave banking huge predictability, and safety, but made banking jobs incredibly boring.  Decades of deregulation made banking a more interesting career, but let banks go into riskier businesses, and let banks create financial crises.

The rightful role of Banks probably is more like a utility.  Their job is to manage investment dollars.  This is a fundamental bedrock of society, and if we want that to be a solid bedrock then banks must be tightly regulated.

A local news program going over the difference between banks and credit unions

Protesters from Occupy Santa Cruz wanted to close their bank accounts, but got kicked out of the bank and threatened with the police.

Another group of protesters, in St. Louis, also prevented by BofA from closing their accounts.

 

The Denver Community Credit Union makes a plea for Credit Unions...

 

 

 

Steve Jobs

Arrests of OccupyWallStreet protesters in Boston, arrest threats in Seattle ...

The OccupyWallStreet movement is the latest happening thing in America.  To me it seems like some memes from the "Arab Spring" touched nerves in the U.S. and became this outrage at Wall Street.  What's happening is in cities across the U.S. (maybe it's spread to other countries?) clusters of people have formed, camping out in their downtown areas (e.g. in San Francisco they're camped out on the sidewalk in front of the SF branch of the Federal Reserve) demanding ..something..  It's one thing to have outrage, it's another thing to focus the outrage into meaningful change especially when there's so many opinions of just what change there is to make.

It's also interesting to view this process through the different lenses available.  These popular uprisings have happened in several countries this year, Tunisia, Egypt, Bahrain, Yemen, Libya, and now the U.S., and in each country events have unfolded in different ways, and it's been portrayed differently.  There's a way ones perspective or point of view changes how you interpret these things.

In the U.S. we're seeing Officialdom responding to protesters camped out downtown with police force and arrests.  In NYC a couple weeks ago hundreds of protesters were herded onto the Brooklyn Bridge, where they were arrested for blocking traffic.  We see below that in Boston a hundred or so protesters were arrested in a 1am raid with police attacking a group named "Veterans for Peace".  Boston Mayor Thomas M. Menino has expressed sympathy for the issues expressed by the protesters, saying that corporate fraud and greed are issues he's worked on his whole political career, "But you can't tie up a city" in defending the arrests.  In other words he's saying that the functioning of the city is more important than the protest/ers?

In Seattle the protesters were told the city was not at that time planning to commit any arrests.  However the location of their encampment, Westlake Park, is supposed to close at 10pm each night and the city officials are demanding that protesters obey that regulation, and are threatening arrests.  Further police there are banning people from carrying umbrella's; it's Seattle, everyone carries umbrella's, but protesters who want to stay outside for days at a time and stay dry will rely on umbrella's, so by banning umbrella's it's a sneaky way to make it hard on protesters to do their thing.

I'm sure the Mayor of Cairo had similar thinking last Jan/Feb with the thousands upon thousands of protesters camped out in the center of that city.  I'm sure he woulda said something like "But you can't tie up a city."   The throngs of Egyptian protesters had huge international positive press coverage, with throngs of people around the world rooting for them.  I'm sure it was inconvenient to the Egyptians to have their city blocked up by protesters, with Officialdom in part simply desiring to restore "order".  The Egyptian protesters could have complied with "you can't tie up a city" and kept their protests limited enough to let the city keep functioning, but they didn't.  They had a political regime to change, a society to remake into a positive format, converting it from brutal dictatorship to one that treats its people humanely.

The job of the Mayor is to keep the city running, right?  One could argue that a Mayor who lets protesters run rampant and disrupt things isn't doing his/her job in keeping order.  Even if in the greater scheme of things, the protesters are advocating for positive and worthy change, in the process they're disrupting order.  It's the job of the Mayor or Governor or whatever Officialdom, to work to keep the population orderly and functioning smoothly.  In other words "you can't tie up a city".

On the other hand creating change does mean interrupting the current order of how things are done, so things can be changed into a new/different order.  You can't make an omlette without breaking a few eggs.

You might think that in the U.S. we don't have as dire a situation as they had/have in Egypt.  That our situation in the U.S. isn't as desperate as the Egyptian's or Libyan's.  But, maybe our situation is as dire, or more so, and maybe our situation is part and parcel of their situation.

The Occupy<City> movement has identified "Wall Street" as the culprits.  What they're be pointing to is the corporate-greed-control complex that has subverted the political systems not just in the U.S. but around the world.  In the U.S. a symptom has been the rampant fraud in housing mortgages - Almost a quarter of all home mortgages today are currently underwater, 2 million homes are in the foreclosure process – and at least 5 million homes have already lost to foreclosure since 2007.  A lot of it due to corporatists who set up a fraudulent system to defraud these millions of home owners out of their homes.

But the same corporatists are committing other financial sins all around the world.   "Globalization" means that it's the same global-elite-power-corporatists everywhere.  They are dominating not only the U.S. but the whole world economy.  The issues faced in Egypt in part are the same issues we have in the U.S.  In both cases our political systems have been subverted by the global power/money/elite structure, and many rightfully see e.g. the economic meltdown etc as a symptom of the looting and fraud behind the banking chaos.

 

 

Boston Police Attack Veterans for Peace by @haveyoumetter for @DigBoston

Boston’s mayor: “Civil disobedience will not be tolerated”

The worst OWS moment so far

Seattle pressures protesters to relocate

Jubilee 2012?

Nobody got rich on their own - Elizabeth Warren clearly explains the social contract, shows why right wing rich coddlers have it all wrong

There's a chorus that's been making me sick, and Elizabeth Warren just speared the chorus with a clear thinking straight to the core issue description of the social contract.  The what?  The social contract was something I vaguely recall hearing about in History class way back in High School, but it's basically the bargain we make with each other as a society that keeps the society running.  Scroll down to the video below - or else read a bit of my ranting first.

BEGIN-RANT: The right wing chorus that's taken over has this irrational basis in individual freedom, individual responsibility, getting the government out of our affairs, etc.  But it's entirely hypocritical - because the same people who push for individual responsibility also pushed for the bank bailouts in late 2008.  If they were all hot for individual responsibility they should have just let the banks fail, that would have taught those bankers a thing or two.  And what about government intrusion into deciding who can and cannot marry?  Why should the government be controlling this, and say that marriage can only be between a man and a woman?  And what about the ability to choose to have an abortion?  Why should the government intrude into this, if government should be small and out of our individual lives?  The examples of hypocracy can go on and on .. and hypocracy exists in the Democratic party not just those close minded right wing blow hards in the Republican party.  BTW - hypocrisy and hypocracy are different but similar things.

Basically the thing going on is the public conversation is about coddling the rich - making sure the rich have all sorts of benefits, tax loopholes, ability to commit crimes and get off scotch free (witness the recent rape allegations against Domonique Strauss-Kahn that got dropped), etc etc etc ... A common bit of rhetoric is the "self made zillionaire" whose right to run their factory (or whatever) the way they want is sacrosanct, and the government should but out.

The truth is that we are not individualists.  One of the American memes is individualism, but it's really a figment of our collective imagination.  None of us can get along on our own.  Anything we do is done within a context created by all of us working together.

END-RANT: This is where you'd start reading again if you skipped my rant.  This is a transcript, and below that is the video.  The speaker, Elizabeth Warren, has spent the last couple years working to establish a consumer protection agency.  But due to Republican led coddling of the rich, she isn't being allowed to be considered to be the lead person of that agency she worked so hard to create.  They are afraid to give her that power, and someone else got the job instead.  As a result she is now a candidate for the Senate in Massachusetts.  After hearing her say this I'd almost want to move there so I could vote for her; but then I remember the stories about their winters and, well, there are braver people than me living in that state.

I hear all this, oh this is class warfare, no! There is nobody in this country who got rich on his own. Nobody. You built a factory out there—good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that maurauding bands would come and seize everything at your factory… Now look. You built a factory and it turned into something terrific or a great idea. God bless! Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.

The Shock Doctrine

URL: 

The Shock Doctrine

Description: 

In THE SHOCK DOCTRINE, Naomi Klein explodes the myth that the global free market triumphed democratically. Exposing the thinking, the money trail and the puppet strings behind the world-changing crises and wars of the last four decades, The Shock Doctrine is the gripping story of how America’s “free market” policies have come to dominate the world-- through the exploitation of disaster-shocked people and countries.

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