*FOR IMMEDIATE RELEASE – OCTOBER 21, 2011*

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FEDERAL RESERVE AGREES TO SAVE BANK OF AMERICA’S WEALTHY MANAGERS AT TAXPAYERS’ EXPENSE. AGAIN.

Occupy Boston learned this week that Bank of America’s holding company (BAC) has moved troubled derivatives from its subsidiary, Merrill Lynch, to Bank of America, which is insured by the FDIC and, ultimately, the US Treasury. Bloomberg News reports that BAC moved the troubled derivatives after having its credit rating downgraded last month. This downgrade was due to its relentless acquisition of failing companies like Countrywide Financial and Merrill Lynch, both of which have massive, hidden losses that will now to be borne by the 99%.

This means that Bank of America’s exposure to the ongoing European debt crisis is now insured by US taxpayers. This direct transfer of risk was completed without approval by regulators and, needless to say, without public input. It was done over the opposition of the FDIC, which objected because it put the insurance fund at risk. It was done with the support of the Federal Reserve, which, now more than ever, clearly represents the interests of the 1%. Bloomberg also reported that other investment banks’ derivatives positions have been placed in insured banks so that taxpayers will bear the risk of those losses as well. Collectively, the insured banks’ derivatives exposure is well over $100 trillion—far larger than the world’s GDP.

US taxpayers are now on the hook for trillions in bad deals made by Bank of America and JP Morgan when the next Systemically Dangerous Institution (SDI)—a term that refers to the supposedly “too big to fail” banks—fails again. A mere three years after taxpayers rescued US banks, the anti-regulators that lead our regulatory agencies are still unable or unwilling to protect the American people from insuring risks generated by investment-banking operations. Bank of America, which got a $45 billion bailout during the financial crisis, had $1.04 trillion in deposits as of midyear, ranking it second among US firms.

When reached by phone, former regulator William Black emphasized that this is precisely the sort of behavior that was prohibited by the Glass-Steagall Act before many of its provisions were repealed in 1999, and that were encouraged by the Commodities Futures Modernization Act of 2000.

“In Ben Bernake we have a quiet, professorial type who nevertheless remains reflexively opposed to any effective regulation, investigation, or prosecution of the fraudulent SDIs that drove this crisis,” Black said.  “The Fed serves the 1%. The fact that he, a strong Republican, was reappointed by a Democratic president after a track record of abject failure as the nation’s leading anti-regulator says everything about just how successful international finance has been in capturing our democratic institutions.”

Occupy Boston supports transparency in banking. Those who join us might echo Black’s call for the Federal Reserve to release the name of the individual who approved this action and the exact composition of the assets and liabilities that were transferred. They might further sign this petition calling for the reinstatement of the Glass–Steagall Act and join in the upcoming Bank Transfer Day on November 5.

We are the 99%, and we are no longer silent.

Occupiers Acacia Brewer and Jason Potteiger spoke on NECN earlier about Occupy Boston and clarified some misconceptions. Check it out here.

Published October 4, 2011 in the Tufts Daily student newspaper. 

By Gary Goldstein

Several articles, op−eds and an editorial have appeared related to Occupy Boston. I went down to Occupy Boston Sunday afternoon. I ran into another Tufts faculty member and an alumnus. It wasn’t easy to find other Tufts people among the several hundred encamped there. I know some of you were there.

Why did I go down to Occupy Boston? I saw the news that 700 “Occupy Wall Street” people were arrested in New York City! Is that freedom of speech? “Freedom of speech” for large corporations, e.g. Bank of America, Exxon−Mobil and General Electric was recently guaranteed by the Supreme Court. Corporations can virtually buy politicians and elections. What about the rights of citizens to protest? You might say, “Well, they blocked traffic!” What could threaten civil order more, blocking traffic and the inconvenience it causes, or taking away people’s homes, employment, health benefits, retirement pensions and education opportunities? Do we sit back while corporate and government policies leave 25 million people unemployed or underemployed? Do we accept that sending people away to endless wars of destruction is how our economy should be funneled? Do we accept that the United States has the highest prison population — well over 1 million — among industrialized nations? Do we tolerate the further erosion of opportunities for the growing numbers of poor among us? Well, 700 people who do not accept and tolerate these intolerable circumstances were arrested for speaking, shouting, protesting and marching. So I went to Occupy Boston. I urge you to do the same.

The Occupy Boston camp is a very impressive undertaking. People, mostly under 40 years old, are very well organized in non−hierarchical, open democratic ways, committed to the cause of economic equity and settled in for a long haul. They are attracting local media attention, at least for now. The police are not large in numbers. The feeling is very upbeat and hopeful. I am reminded of sit−ins, teach−ins and occupations of administration buildings over many years of being politically active during my time at Tufts and earlier. It is a good feeling! It will grow.

The criticisms that there is not a single guiding message or an identifiable leader are premature and, perhaps, misguided. Successful movements don’t spring up, fully formed out of nowhere. They build gradually, attract more and more attention and gel around central issues. Looking back at popular history can be misleading. Charismatic leaders like Martin Luther King, Mahatma Gandhi, Malcolm X and Nelson Mandela didn’t appear overnight with full−blown movements of thousands. They emerged from long struggles carried forward by hundreds of anonymous supporters of causes and strategies that cohered over time. Workers’ rights, gay rights, women’s rights, social welfare programs, unionism, the ending of the Vietnam War, the reduction of nuclear weapons all resulted from the efforts of thousands of people, now unknown, who were fired up to demand change.

We should support the beginnings of a movement that aims to ameliorate the social and economic inequalities that now plague the United States. We see huge corporations and banks cutting costs and workers, sending work abroad, while pulling in record profits. Most members of Congress spend their days cutting budgets for social programs, education, health and welfare, scientific research and grants for states and cities. The results we see — increasing unemployment and misery for many, especially among minorities, while the United States wages indefensible, enormously expensive wars of destruction, ruining the future for Americans and threatening the rest of the world. Tufts students are not immune. The search for suitable jobs after graduation will be difficult.

We are living in difficult times. Without support for meaningful change we will be left with declining prospects for the fair and equitable society that we all hope to inhabit in the future. There is much hope in this new movement. Go downtown to Occupy Boston! With your support and participation we may see a movement grow and succeed.

Gary Goldstein is a professor of physics and astronomy.

Click here to see the slideshow!

And yesterday’s: http://www.flickr.com/photos/scotteisenphotography/sets/72157627769988418/

Via scotteisenphotography Flickr