Once Again, Congress Will Let Wall Street Pillage Main Street

| Educate!

Above photo: By arindambanerjee/Shutterstock.com.

Over the last decade, Congress’s approval ratings have hovered around the mid-teens or low 20s, reflecting the reality that our representatives in Washington, D.C., serve the needs of big donors while throwing an occasional rhetorical bone to the “essential” workers who actually make the country function. Congress’s handling of the current crisis of the pandemic is unlikely to improve its ratings.

Working Americans are facing an unprecedented disaster. Before the virus hit, half of them lived paycheck to paycheck and didn’t have $400 saved for an emergency. Now they have been ordered to stay home. Many have no income while their rents, utility bills, student loans, and credit card debts are accruing.

The small businesses—restaurants, gyms, and stores—that provide half of the nation’s jobs were ordered to shut down. Their rents are accruing. And with no income coming in, many have little chance of repaying what they owe when the economy reopens.

Congress has responded in typical fashion by protecting its donors—the investor class—the only people in the country who didn’t need help. By unrecorded voice vote, Congress passed the CARES Act, rushing $1.77 trillion in taxpayer money out the door to help their friends on Wall Street. This bailout also saved the stock market and preserved the wealth of the 10 percent of Americans who own 85 percent of the stocks and bonds.

And to add insult to injury, the Federal Reserve is providing trillions more in free money to fortify the banks so they can continue to collect 21 percent interest on your credit cards and buy up your distressed assets. Ordinary Americans will receive a one-time payment of $1,200, if their creditors don’t scoop it up first, and some unemployment relief, if their state’s system is functioning after the flood of new claims. (In the last six weeks, more than 30 million workers have applied for unemployment compensation.)

Governments of other countries are covering wages to keep workers in their jobs until this emergency is over. A similar plan was proposed in both the Republican-controlled Senate and the Democratic-controlled House. But it wasn’t taken seriously or brought to the floor for debate. Neither of the two corporate-backed parties that share power in the U.S. believe that any drastic measures are necessary to save Main Street.

Congress did set up a loan program for small businesses, the Paycheck Protection Program (PPP). But the big banks who were put in charge of distributing the loans gave much of the money to publicly traded chains that were allowed to claim small business status under a loophole written into the bill by their lobbyists.

Many economists are predicting a dangerous explosion in a matter of months when rents and mortgages cannot be paid, businesses fail, and temporary layoffs turn into permanent job losses.

As was the case in the 2008 bailout, Congress has assured that none of the pain will be borne by its big donors. Bank of America, Citibank, Wells Fargo, and JPMorgan Chase won’t lose a penny. Their executives will get their bonuses and their investors will get their dividend checks. Once again, big banks have been allowed to collect their profits on risky loans even when those loans go bad. In other words, the big banks’ risk has been socialized—covered by the taxpayers—while their profits remain privatized. This is capitalism in the 21st century.

And following the playbook of the 2008-09 bailout, the Fed is making funds available to their Wall Street cronies to buy up distressed Main Street assets at fire-sale prices. Big companies will pick up small companies. Blackstone will buy up more real estate. The economy will be even more centralized.

States and municipalities are also facing rapidly approaching disasters. Unlike the federal government, states and cities cannot run a deficit or print money. They have to actually pay for things like public services and unemployment insurance by collecting revenues from sales taxes and income taxes. And they are not getting those revenues.

Nevertheless, only about 5 percent of the $3 trillion in total coronavirus relief has gone to help the 50 states. Senate majority leader Mitch McConnell suggested that Congress might let states go bankrupt, meaning among other things, that workers’ pensions would likely evaporate.

House speaker Nancy Pelosi was recently asked whether she and Senate minority leader Chuck Schumer made a “tactical mistake” in not providing any help for state and local governments in the relief bills. In response, she told CNN’s Jake Tapper to “just calm down.”

Tapper reportedly did calm down. But it’s not clear if ordinary Americans will just calm down when their businesses are closed and their families are thrown out into the streets.

The Democratic Party that controls the House still tries to sell the outdated notion that it is fighting for working people. Yet, despite its powerful allies in the mainstream press, fewer and fewer Americans are buying the ruse. First, we all just watched as the entire Democratic Party establishment came together to stop an insurgent candidate in the presidential primaries, Bernie Sanders, whose major sin was his refusal to sell out to Wall Street donors. Instead, the working man’s party has united behind Joe Biden, a reliable servant to Wall Street banks for nearly 50 years.

In a time when the health of our nation depends on a health care system capable of providing our neighbors with testing and treatment for a highly contagious disease, even if there is no profit to be made, the nominee for president of the working man’s party has promised his donors to veto a Medicare-for-All bill if it crosses his desk.

A second reason working Americans are less willing now to “vote blue no matter who” is that they remember the 2008-09 bailout. Back then, Barack Obama was in the White House and the Democrats controlled both the House and Senate. Wall Street banks crashed the economy by selling exploding mortgages to poor people and then packaging those worthless mortgages into worthless investment securities. Obama bailed out the banks—his major campaign sponsors and donors—and he let ten million Americans lose their homes. Wall Street companies like Blackstone were allowed to buy up foreclosed homes for pennies on the dollar, and then very quickly raise rents on Americans. As a result, Black and Brown people who graduated from four-year colleges lost 70 percent of their wealth under the first Black president, according to a Federal Reserve study.

The Democratic Party learned one important lesson from 2008: it is best not to control the office of the president and both houses of Congress. Too much power makes it harder to serve the interests of the big donors while still pretending to fight for ordinary working Americans. It is much better to split power and blame the Republicans for screwing working people.

Did you ever wonder why Democrats always lose when Republicans try to game the system to silence minority voices? Republicans encounter little resistance when they gerrymander districts to make them safe from minority voters, suppress minority voters at the polls, enact filibuster rules that allow corporate interests to block popular legislation, and preserve the arcane Electoral College. All of these schemes benefit the corporate patrons of both parties by making it less costly to rig the system. Corporations don’t need to own all 535 members of Congress, or even a majority of them, to control the levers of power.

It is generally acknowledged that the situation today is more dangerous than the financial collapse of 2008. The coronavirus has shut down large parts of the economy. And because we were so ill prepared for the pandemic, there is great uncertainty as to when or how the economy will restart, or what it will look like.

Since our government has refused to bail out small businesses or ordinary working people, prominent economists like Professor Michael Hudson at the University of Missouri at Kansas City have warned that the government will need to intervene and allow Americans to write down debts that cannot be paid, or we will face economic meltdown. But writing down debts would harm the big banks, so it probably won’t happen under this Congress or this president.

I like to end columns on a positive note. I have long advocated using democratic means to wrest political power from corporations and return it to the people. But right now, the economy appears to be headed off a cliff and the corporations have a tight grip on all the controls. And I am not smart enough to know how people can take back power without a violent revolution. One thing I am sure of is that when American families start getting kicked out of their homes, the Democrats will blame the Republicans, and the Republicans will blame anyone but themselves.

This article was produced by Economy for All, a project of the Independent Media Institute.

Leonard C. Goodman is a Chicago criminal defense attorney and co-owner of the newly independent Reader.

  • Steve

    Haha I love this so true

    The Democratic Party learned one important lesson from 2008: it is best not to control the office of the president and both houses of Congress. Too much power makes it harder to serve the interests of the big donors while still pretending to fight for ordinary working Americans. It is much better to split power and blame the Republicans for screwing working people.

    We the people need to organize better to elect real progressives and take over the party or get a new party. At the end of the day it’s us, we the people, that are at fault for allowing our democracy to be high jacked by money class. Your average Republican voter thinks minorities are stealing his money. Your average Democrat voter thinks it would be cool to have a black president. Analysis doesn’t go much deeper than that thus we are fucked. Americans on balance are not a serious people while they, the lobbyists, are.

  • John Schoonover

    Building a new party is the right thing to do, but not a mere electoral party. No elite in history has ever surrendered its power through an election. A new party has to be an organizing force capable of seizing power.

  • jemcgloin

    ‘After banks stumble delivering aid, Congress considers alternatives.’

    Divide Our BAILOUT money EQUALLY among all CITIZENS to save EVERYONE, and to create DEMAND that GROWS the economy.

    Every trillion dollars in bailout money is $3,000 FROM each citizen (or $12,000 from a family of four) of Our money from Our Treasury.
    We the People know best where Our money needs to go. Paying debts bails out banks. Shopping bails out retail.

    From 2008 to 2020 Congress and the Federal Reserve threw many trillions of dollars at global banks, who were supposed to lend it to American businesses to grow demand to grow the economy.
    Years into the downturn, the banks were asked why they were sitting on trillions of dollars in cash and refusing to lend it, the banks openly said they were waiting for demand to come back.
    Under this system of using global banks to distribute Our money, it took TEN YEARS to recover from the Great Recession. This hole is ten times bigger than that.
    The interests of global banks are not aligned with the interests of U.S. citizens.
    We are borrowing and creating trillions of dollars in cash, and giving it to the very people that keep creating and popping market bubbles so they can suck cash OUT of the real economy.
    Increasing supply does not grow the economy. It lowers prices but lowers the income of consumers, more. This creates deflation which is far more dangerous than deflation.

    When consumers have more cash they clear inventories, creating a NEED for investment.

    There are democrats pushing this kind of plan right now. I would suggest supporting those democrats push this plan. It would put money in the pockets of those that need it most.

    I am not a ‘lesser evil voter. I voted for Jill Stein in 2016. This year I will vote for Biden, because I am a lesser dictator voter. Biden is a lesser dictator. Trump is maximum dictator.

    We can have Godzilla or mini-godzilla. I’ll vote for mini-godzilla, because right now, Godzilla is crashing through my city killing thousands. Democrats may have helped to create Godzilla, but if we let Godzilla stay in office another term, we will not be able to stop him or the Democrats either.

    Voting for Trump is suicide. Voting for Democrats buys us time. Voting for a third party is not a vote for Trump, but it won’t solve the immediate problem.

  • mwildfire

    I suppose you can blame the people for not investigating before voting, and for falling for feel-good crap like Russiagate–but what usually happens is that enough votes are stolen by provisional ballots, gerrymandering and the relentless lies of the MSM that they can get away with stealing a few more electronically, thus knocking Sanders out for example. So then we get a choice like Biden versus Trump. You can vote for Biden or you can vote for Sanders as a write-in or you can vote for Howie Hawkins or Minnie Mouse or not vote at all;. It doesn’t matter–either Biden or Trump will be president and will it really be the voters’ fault? Did we choose Trump in 2016, will we choose him in November (if there even is an election)? Not really, so it isn’t fair to blame us.

  • mwildfire

    For years I have argued for nonviolence. Now, I keep having this image of people hauling this dusty old thing out of the attic, cleaning it off, and taking it into the town square. It’s a guillotine. I’m afraid it’s going to come to that because the elite have been working very effectively for 40 years to seal their hold on power so they can’t be dislodged. Including by putting the bellows to the flames of the culture wars, and seeing to it the fascist side is well armed. They will defend the PTB, while imagining they’re fighting the elites.

  • Edward Winslow

    Mr. Goodman has come to believe that violent revolution is the only method left to we the people in a country that is dominated by a tiny, heartless plutocracy. I believe he is correct. But violence in the face of the occupation force (militarized police) and even members of the military will not succeed.

    The coming revolution must be a smart one. Clandestine activities and direct action that avoids direct combat with forces of the illegal government is the way to achieve our goals. It has taken decades for the criminal class to abscond with our liberties and treasure; it will take decades to unseat these villains.

  • Let’s go the ROOT CAUSE of this massive corruption problem destroying human society in general and American society in particular: The total embrace by monied elites of the PSEUDO-SCIENTIFIC RELIGION of SOCIAL DARWINISM.

    The Federal “Reserve” and all other Central Banks have one Social Darwinist Job to do: steal from your labor to create wealth for the families. Social Darwinism is the morally bankrupt ideology spawned from the scientific and business community’s embrace of Darwin’s evidence free Theory of Evolution over 150 years ago.

    From the time during the late 19th century that Darwin’s pseudo-scientific atheist bible, Origin of Species, became widely accepted as the “science based truth” about how life originated on Earth, 😈 greed worshippers everywhere jumped at the chance to justify their selfish socially destructive ideology by pointing at the “science” of evolution.

    Enthusiastic converts to Social Darwinism have, to this day, used the language of evolution to frame an understanding of the growing gulf between the rich and the poor, as well as the many differences between cultures all over the world. The explanation they arrived at, and continue to use to justify biosphere trashing profit over people and planet, regardless of any alligator tear mendacious claims to the contrary, is that businessmen and others who are economically and socially successful are so because they are biologically and socially “naturally” the fittest.

    Conversely, they reason that the poor are “naturally” weak and unfit and it would be an error to allow the weak of the species to continue to breed. They believe that the dictum “survival of the fittest” (a term coined not by Charles Darwin but by sociologist Herbert Spencer) means that only the 😈 fittest should survive.

    Why do so many people believe the pessimistic, nihilistic, and depressive Darwinist view? One reason is they are convinced that science has proven Darwinism to be true. Sadly, however, many scientists are unaware of the large body of evidence supporting creationism. And numerous scientists recognize that, at best, the view common among elite scientists is unscientific. Shallis argues that:

    It is no more heretical to say the Universe displays purpose, as Hoyle has done, than to say that it is pointless, as Steven Weinberg has done. Both statements are metaphysical and outside science. . . . This suggests to me that science, in allowing this metaphysical notion, sees itself as religion and presumably as an atheistic religion (pp. 42-43).

    Darwinists have indoctrinated our society for over 100 years in a worldview that has proven to be tragically destructive. And they often have done this by a type of deceit that began before the Piltdown hoax and continues today in many leading biology textbooks (Wells).

    The money lenders have played a key role in funding this deceit propagated in high schools and universities, where it is passed off as “science”. It is, and always was, BULLSHIT formulated by the monied elite to dress up selfish, abusive, exploitive and cruel behavior towards “less important” humans and/or animals experimented upon in research labs, as “scientifically justified”.

    The money lenders hate you. They want you to be slaves on their plantation. They want you dead. They want you to have no rights, no freedom, and no future. The Federal “Reserve” is there to maintain power over you. It is there to turn your energy state into fear and anger and sorrow.

    This makes the families happy when your energy goes to them and you act in conformity with their will. Believing the Fed was meant to achieve any other outcome is a failure to appreciate the satanic precision and abhorant, life-destroying purpose of it. Choose any central bank over its history and explain how it’s operations are not a net-negative.

    We would, very literally, be better off with no common currency than with a central bank managed one. That course was very successful for 200 years, and is why our currency is named the dollar. Spanish “Thollars” were common. People chose them on their own. Many alternatives were available. Cutting them in eighths, like a pizza, was common to pay for smaller transactions. These were called “pieces of eight”. If no one can centrally control the currency, it is harder for conspirators to systematically rob you.

  • Steve

    You might be right but don’t independent/reform and libertarians and greens get on ballot in most states if not all? Yet they only get 0-5% of votes. That’s our problem thinking only two choices. If you only vote Blue or Red then there will be only two choices. Why can’t we break out of this mold as a people?

    As far as revolution. I just don’t see it. Violent or non violent. We are not French who block whole cities with tractors over small stuff let alone if TPTB ever tried to cancel UHC. We are a docile people again not serious people. Closet we came was in the 1960s and 1970s riots/marches and Nixon responded well – so much so he’s been called the last liberal president, and got them off the streets.

  • Steve

    Clandestine in age of total information awareness and no 4th amendment? That seems rather unlikely. Your/Mine post was just databased in some NSA data center and if using a cell phone it took a picture too. I think best chance is get a platform like 10 pts the 75% can agree on. Nothing too radical. Like money out of politics. $15 min wage. Medicare for all. Ending homelessness. Stuff that polls positive on FOX and MSNBC. The first one (money out) is really all you need but 10 pts nevertheless. Call it the “peoples party” and mobilize.

    Second option is Nationwide strikes and freeze country up.

  • Steve

    Yeah it’s an evil religion. Even if you have empathy survival mode sometimes turns you anti-social/sociopath. Small business owners like myself simply can not survive not making heart breaking choices. Like constantly seeking best labor for lowest pay while cutting deadwood. Thats just one example. But if you don’t your more sociopath competitors will put you out of business or you won’t make profit. My big regret was not becoming a teacher like my parents. Grass seems a little greener there unless you are like a 14 year post doc looking for tenure.

  • John Schoonover

    Revolutions happen when they happen. The French were a docile people until they overthrew their monarch. We were on the verge of revolution in the 30s. FDR recognized that and calmed things down with the New Deal. We may already be in a pre-revolutionary situation. I refer you to Peter Turchin’s “Ages of Discord” for an interesting perspective on that.

  • I understand your plight and share your frustrations. As a retired air traffic controller and former air taxi pilot, my hands are as dirty as anybody else being herded by TPTB into contributing 24/7 to the destruction of everything we hold dear. 😞

    My advice to you is to never, under any circumstances, support or vote for either wing of the US Duopoly (i.e. the Republlcan or the “Democratic” Party). If they lose all popular support, we still may not get the polices needed to return to sanity, but it is better than giving the tacit approval, which just perpetuates their belief that we cannot stop them. The consent of the governed must be taken away from those evil bastards before ethics can begin to reverse this unethical race to the bottom in our society.

    “We can’t have a healthy business on a sick planet.”— Ashley Orgain, manager of mission advocacy and outreach for Seventh Generation, Burlington, Vermont

    “We do not need a ‘new’ business model for energy because we never had one. What we need, if we wish to avoid extinction, is to plug the environmental and equity costs of energy production and use into our planning and thinking. ” — A.G. Gelbert

    “Facts do not cease to exist because they are ignored.” — Aldous Huxley

    “Technical knowledge of Carrying Capacity will not save us; only a massive increase in Caring Capacity will.” — A. G. Gelbert

    “Some people talk about NIMBY, which stands for “not in my backyard”. We’ve got to change NIMBY to NOPE, not on planet earth.” — A. G. Gelbert

    “There is a terrible desperation to the increasingly pathetic rationalizations from the climate denial camp. This comes as no surprise if you take the long view; every single undone paradigm in history has died kicking and screaming, and our current petroleum paradigm is no different. The trick here is trying to figure out how we all make it to the new paradigm without dying right along with the old one, kicking, screaming or otherwise.” – William Rivers Pitt

  • “There are axioms in probity, in honesty, in justice, as there are axioms in geometry; and the truths of morality are no more at the mercy of a vote than are the truths of algebra. The notion of good and evil cannot be resolved by universal suffrage. It is not given to a ballot to make the false become the true and the unjust the just. The human conscience cannot be put to the vote.” — Victor Hugo

    “The rich executed a coup d’état that transformed the three branches of the U.S. government and nearly all institutions, including the mass media, into wholly owned subsidiaries of the corporate state.” — Chris Hedges

    “Facts do not cease to exist because they are ignored.” — Aldous Huxley

  • 👍 All the points you raise are reasonable and valid. I would add that the legal tender laws in the USA, which give the 💵🎩🍌 Federal “Reserve” the tyranny of counterfeiting with impunity for the benefit of the 😈 parasitical elite and the inflationary detriment of the rest of us 🥺, need to be 🗽 rescinded before initiating those reforms. As soon as we are not FORCED to accept the Federal “Reserve” funny money currency for all debts public and private, they no longer can counterfeit with impunity.

    “Fascists, like termites, are able organizers, and thoroughly attached to their way of life.” — James Stewart Martin — ALL HONORABLE MEN

  • GaryReber

    Yes, I agree, the Federal “Reserve” is engaged in the tyranny of counterfeiting. We need to tied all new money creation to the actual formation of new productive capital assets.

  • Steve

    Oh I won’t. Green is only party I’ll vote for as it’s the only party to have sustainable plans for our monetary and environmental systems not to mention everything we hold dear as you say. Sadly I’m few so that dupoly assault will proceed until more and more people wake up from the slumber. Articles like this and others help and most people know something is rotten in Demark by now so I have hope, especially in our young people indoctrinated with neo-liberal gangster pain from day 1 unlike us who lived a relatively charmed life off, now gone, FDRs reforms..