Break Up the Banks, Raise Their Capital Requirements

Just read two articles related to the new focus of this blog.

Ed Kilgore at Political Animal offers this on breaking up banks that are "too big to fail":
http://www.washingtonmonthly.com/political-animal-a/2014_03/can_anything_short_of_breaking049437.php

Kevin Drum at Mother Jones has his say about the need for higher capital requirements:
http://www.motherjones.com/kevin-drum/2014/03/europeans-unhappy-over-high-american-capital-standards

New Focus for Involved Voters Blog

The new focus for this blog comes largely from my recent reading of The Bankers' New Clothes: What's Wrong with Banking and What to Do About It.

This 3 minute video clip by co-author Anat Admati will give you an idea of what the book contains: https://www.youtube.com/watch?v=ZDRpZvCOVrc

It's my aim to help all of us understand how essential reform of the US (and global) financial system is to our economic health and stability, and get involved by applying political pressure for reform.  I'll be posting links to groups and resources related to financial system reform.  Your suggestions via email are welcome.

Five Years after the 2008 Financial Crisis

Just a quick post to share this link and point out that a recovery is in process despite the Republicans in Congress.  Imagine how much farther along we'd be if there had been bipartisan cooperation and no Republican obsession with defunding the Affordable Care Act.  And imagine how a government shutdown will affect the recovery for those of us not in the top 1%.

http://www.whitehouse.gov/five-years-later

Banks Need to Have More Skin in the Game

If you only contact your US Representative and Senators about one thing this year, it should be about putting in place sensible banking regulations.

Check out this New York Times opinion piece to find out why:

http://www.nytimes.com/2013/08/26/opinion/were-all-still-hostages-to-the-big-banks.html

Here's a sample:

Prudent banks would not lend to borrowers like themselves unless the risks were borne by someone else. But insured depositors, and creditors who expect to be paid by authorities if not by the bank, agree to lend to banks at attractive terms, allowing them to enjoy the upside of risks while others — you, the taxpayer — share the downside.

Implicit guarantees of government support perversely encouraged banks to borrow, take risk and become “too big to fail.” Recent scandals — JPMorgan’s $6 billion London trading loss, an HSBC money laundering scandal that resulted in a $1.9 billion settlement, and inappropriate sales of credit-card protection insurance that resulted, on Thursday, in a $2 billion settlement by British banks — suggest that the largest banks are also too big to manage, control and regulate.

NOTHING suggests that banks couldn’t do what they do if they financed, for example, 30 percent of their assets with equity (unborrowed funds) — a level considered perfectly normal, or even low, for healthy corporations. Yet this simple idea is considered radical, even heretical, in the hermetic bubble of banking.

When we deposit money in a bank, we are lending it to the bank and they invest it.  If banks were risking more of their own money (equity) and that of their shareholders' (potential dividends), they would be inclined to take fewer risks with our money.

Calling out Republican "Insurgents"

It's not just ideology on steroids, it's a plan.  A plan to sabotage the Obama administration.  It involves taking hostages - and they are us.

http://truth-out.org/opinion/item/17993-are-you-prepared-to-shoot-the-hostage

After you read this, you might just want to let Republicans in Congress know what you think.

Republicans in Congress are taking US health care in the wrong direction

OK, I get that Tea Party Republicans hate President Obama and are automatically against whatever he tries to do.  They have done and are doing everything imaginable to get rid of the Affordable Care Act / ObamaCare.  Then they point to delays in implementation of a few provisions of the ACA (which they helped cause by moves like the sequester of funds that's degrading services to all of us) as proof that ObamaCare should be repealed.

If you want to get the big picture of why the Affordable Care Act is so important for all of us, I recommend this video: http://www.iihealthcare.org/iihealthcare-blog/2011/8/31/the-future-of-us-healthcare.html. It's one you'll want to share with your representatives in Congress, especially those who think the private sector (insurance companies) is going to put the health of people above profits. Tell your representatives to back off and give ObamaCare a fair chance.

The Problem Republicans Refuse to Address

Here's an excellent video explaining how the current situation of inequality in America developed.

Inequality exists, but it doesn't have to.  Tell Congress to fix it.  We'll have to lean heavily on Republicans because they don't think it's a problem.