By Chris Chafe, executive director of Change to Win
The failure of the financial services industry to manage risk has led to the most severe economic crisis since the Great Depression.
While managers responsible for the economic meltdown benefit from a taxpayer bailout of billions of dollars, thousands of workers are losing their jobs each day and many millions more are losing their retirement savings. Despite this backward reality, it appears as though the banking executives that got us into this mess aren't quite finished abusing America's hard working families.
At issue is the Employee Free Choice Act, proposed legislation that would make it easier for workers to join a union, leading to increased wages, greater consumer capacity and confidence and much-needed economic stimulation as workers' spending drives sustainable, long-term economic recovery. Perversely, the Financial Services Roundtable (FSR) has made lobbying against the right of workers to organize a top legislative priority. Adding insult to injury, they are using taxpayer-financed TARP subsidies to do so.
The Financial Services Roundtable, whose members account for 78% of the $256 billion in taxpayer dollars already injected into the industry through the Wall Street bailout, lobbied against the legislation in 2007 and 2008, and included it among the recently released 2009 priorities, listing it as a highlighted topic for the March 2009 Spring Meeting. Sitting on the board of the Roundtable - and presumably shaping its lobbying and legislative priorities - are representatives of TARP recipients
Bank of New York Mellon
Two leaders of the Financial Services Roundtable have taken special aim at the Employee Free Choice Act:
Principal Financial Group
Chairman J. Barry Griswell and Liam E. McGee, president of the Global Consumer and Small Business Banking at
Bank of America
FSR board member Griswell has applied for up to $2 billion in bailout funds, and lobbied against the Employee Free Choice Act throughout 2007 and 2008. In fact, Principal has been lobbying on a host of partisan issues that appear to have nothing to do with financial services. In the fourth quarter of 2008 alone, Principal lobbying laundry list -- which spans 47 pages -- included over 356 House and Senate bills on topics ranging from labor, immigration and insurance to consumer protection.
In October 2008 - three days after receiving $25 billion in bailout funds -- Bank of America sponsored what was billed as an "analyst call," but was in fact a blatant call to raise campaign contributions for Senate candidates opposed to the Employee Free Choice Act and locked in tight election races. The call featured ideological opponents of the Free Choice Act Rick Berman, a hired gun dubbed "Dr. Evil" on
60 Minutes, and Bernie Marcus, co-founder of
and Chairman of the Bernie Marcus Foundation, at one point opined that "if a retailer has not gotten involved with this, if he has not spent money on this election, if he has not sent money to Norm Coleman and these other guys, (then those retailers) should be shot; should be thrown out of their goddamn jobs."
In all, TARP recipients spent $114 million on lobbying and politicking in 2008, according to an OpenSecrets.org report issued February 4, 2009. Meanwhile, Bank of America's assault on workers hasn't stopped at just lobbying. They've put workers on state health care rolls, even providing advice on how they can qualify for government Medicaid assistance.
Any private use of taxpayer funds to influence the political process, whether by individual TARP recipients or the industry association they fund, raises serious questions. But the partisan political activity by the Roundtable and its members, and direct lobbying against the Employee Free Choice Act crosses the line. As Change to Win stated in a letter to the Financial Services Roundtable, "it is grossly inappropriate for recipients of taxpayer subsidies to use such monies for lobbying."
Blatant acts of partisan lobbying with taxpayer funds are not only a violation of stockholder interests, they are contrary to the intended use of the TARP funds, and a waste of time, money and resources. This is a time when the banking industry must devote every effort to economic recovery by fixing the system they shattered. It's shameful that the Financial Services Roundtable is taking their eye off the prize and instead lobbying to strip America's working families of the opportunity to achieve the American Dream, and worse yet, using taxpayer-financed TARP subsidies to do so.
Sen. Diane Feinstein (D., Calif.) has joined with a half dozen bi-partisan senators to introduce a bill that prohibits the banks from lobbying with bailout money. As Senator Feinstein said in proposing this act, "Federal dollars were not intended to be used for lobbying, and it would be unconscionable for these companies to misuse taxpayer dollars in this way." Rep. Carolyn Maloney (D., NY) has introduced parallel legislation in the House.
The seven unions of Change to Win join with more than 80 organizations in support of this bill blocking bailout money for lobbying, including the National Taxpayer's Union, Public Citizen, Common Cause, the Commonwealth Foundation and Americans for Tax Reform. In order to restore our financial sector and revive the economy, we need the banking industry to focus on fixing our nation's financial sector, not lobbying against working families.
Chris Chafe is the executive director of Change to Win, a coalition of seven unions representing six million workers. The seven unions are: International Brotherhood of Teamsters, Laborers' International Union of North America, Service Employees International Union, UNITE HERE, United Brotherhood of Carpenters and Joiners of America, United Farm Workers of America, and United Food and Commercial Workers International Union.