“The Boy Scouts of America sought to distance itself Tuesday from President Donald Trump’s highly political speech to tens of thousands of Scouts, after parents criticized the speech and the organization.” — Business Insider, 7/25/17
– – –
HOW TO PREPARE FOR A
TRUMP JAMBOREE SPEECH
The BSA has adopted the following regulations for the safety and well-being of its troops and adult leaders in the event of another speech by President Trump.
1. Two-deep leadership required for a speech ranging from 10 to 45 minutes in length
A minimum of two registered adult leaders, or one registered adult leader and one parent must be present to act as a safe, logic-based touchstone should the speech cross over into inane, divisive ranting.
2. The buddy system should be used at all times, but only if the “buddies” can see past their political differences
For example, if one “buddy” simply refuses to let go of the Clinton email scandal, even in light of Jared Kushner’s email correspondence with Russia, and the other is holding his ears, closing his eyes, and rocking himself to keep from crying, they should probably be assigned different buddies.
3. Any signs of bullying must be stopped immediately
Since the instigator of said bullying will likely be the president himself, and thus cannot be stopped immediately, all other incidents of bullying should be strictly monitored. If the response to reprimand is, “But the president’s doing it, so I can do it,” do not follow up with, “Well, if the president said it’s okay to shoot anyone you don’t like, would you?”
4. Pursuing the Public Health badge is encouraged
Should fellow scouts or adult leaders feel queasy or light-headed during the president’s speech, scouts should consider it a medical emergency, and follow life-saving procedures as outlined in their Public Health manuals. Similar lengths should be taken for anyone arguing in support of the ACA health care bill.
5. Taking notes on public speaking for the Public Speaking badge is NOT encouraged
See all previous speeches given by POTUS.
6. Take safety precautions in the event of an emergency
Emergencies include fire, extreme weather, and angry mob storming the stage because they just can’t take this ridiculous bullshit any longer. Should any of these occur, calmly direct people to the nearest exits, personally assisting the elderly and the disabled.
7. Inappropriate use of smartphones, cameras, imaging, or digital devices is prohibited
Even if it’s to prove to your parents that the president actually uttered the crazy, insulting, might-as-well-be-a-raving-lunatic-shouting-at-inanimate-objects drivel the news said he did.
8. All complaints of POTUS’ speech must be directed to the official Boy Scouts of America Facebook page.
Where they’ll be promptly ignored.
It’s official: Republicans have become an all-or-nothing party committed to going down with Trump’s ship
Growing up my father was a Union guy in a Central New York factory. My mother was a gymnastics coach and swim teacher. We didn’t have a lot of money but we made ends meet. Even after their divorce. If it wasn’t for public assisted housing and occasional times we were on food stamps (after the factory closed) we got by. My parents were liberal minded but fiscally conservative. My father is now a Republican politician. Although I am a left of center guy, there have been republicans who make good points which I agree with. The hypocrisy right now in the republican party has really gone too far for me to stomach.
I know sometimes it is “just for show” but how can you take them serious? Republicans have gotten away with pretense after pretense for decades, hiding behind one phony construct after another. They pin little American flags to their suit lapels, hiding behind patriotism. Thrice married hypocrites like Newt Gingrich hide behind “respect for marriage” as they oppose gay marriage. Tennessee Congressman Scott DesJarlais, who was recorded urging his mistress to get an abortion, paid for two abortions for his own wife, and had six sexual affairs with women at a hospital he managed, hides behind “family values” as he opposes abortion for other women. The entire Republican congress has hidden behind “respect for our veterans” as they have voted to cut the budget for the VA over and over again. They hid behind “Benghazi” as they voted to cut the State Department budget for embassy security. They hide behind “national security” to justify everything from torture to the completely insane wars in Vietnam, Afghanistan and Iraq. They hide behind “fiscal responsibility” as they vote to eviscerate the Consumer Protection Bureau. They hide behind love of “the market” as they vote to make it easier for banks to gamble with money deposited by their customers that is insured by the Federal government. They have hidden behind “law and order” to get away with everything from Jim Crow laws to outfitting local police forces like fully armored regiments ready for war.
But we have arrived at a point both in the nascent Trump presidency and in our national political life when they can’t hide any longer who they are. Their desperation to support Trump at any cost is forcing them into the open. Just in the last week, we have reached an apotheosis of sorts. It seemed as if every time you turned on the TV, another mask came off. Early in the week, Attorney General Jeff Sessions, who has been on something of a campaign to recreate the “law and order” Republicanism of old, was stripped of pretense before the Senate Intelligence Committee. Relying on a tactic long used by defense lawyers — you remember them, don’t you, Jeff? The guys at the table opposing your prosecutors — Sessions used the dodge of “I cannot recall” or “I can’t remember” so many times the news shows ran his fake faulty memory on a video loop. But that was only the half of it. Pressed on numerous occasions by Democrats on the committee to answer simple questions about the decision to fire FBI Director James Comey, Sessions invented from whole cloth a new privilege in refusing to answer their questions. When it was pointed out that only the president could invoke executive privilege, Sessions said “it would be inappropriate for me to answer and reveal private conversations with the president when he has not had a full opportunity to review the questions and to make a decision on whether or not to approve such an answer.” Sessions in effect invoked executive privilege preemptively, something which had only been attempted twice in the past: The same dodge was used a couple of weeks ago by Director of National Intelligence Dan Coats and National Security Agency Director Michael Rogers in refusing to answer questions before the same committee, making it look like all three had been coached to use this invented privilege.
Meanwhile, behind closed doors in a basement hidey-hole somewhere else in the Senate office building, Majority Leader Mitch McConnell was writing the new top-secret Republican “health care” bill, preparing to ram it through a vote before going on summer recess. It hardly needs pointing out that this is precisely what Republicans for years accused Obama of doing when Democrats passed the Affordable Care Act in 2009 — which they didn’t. It took more than a year and dozens of hearings and more than 140 Republican amendments before the ACA was passed — without a single Republican vote. Meanwhile, in yet another Senate hearing room, Senator Elizabeth Warren asked a committee chairman when they were going to see the bill and if it would strip people from prescription drug coverage, Medicare and Medicaid. He simply refused to answer her. It has become increasingly obvious that the GOP feels that if this bill was given even a little bit of scrutiny it would piss off so many that the backlash would be devastating. Any proposal that will drop 20 MILLION people off health care cannot be called a healthcare bill. It is just another tax break.
Back at the Intelligence Committee, for the second time in as many weeks, Senator John McCain cut off Senator Kamala Harris’ questioning of Sessions when her questions got a little too pointed. Sessions, who wasn’t enjoying being grilled by the Senate’s only African-American female member, laughed as McCain delivered his dressing down to Harris. Two white men, at least one of them having been accused of being a racist when he was rejected by the Senate for a Federal judgeship some years back, telling a black woman to essentially shut up. Any Republicans on the committee come to her defense? Nope. In fact, the chairman, Richard Burr of North Carolina, backed up McCain and closed off her questions altogether by calling time on her. By week’s end, Republicans had even tried banning reporters from interviewing senators in the hallways of the Capitol and Senate office building, before abandoning the move under intense media criticism. First Amendment, anyone? Republicans? Anybody for the Constitution these days? Apparently not.
Over at the Pentagon, generals in the halls of the E-Ring were celebrating the news that Trump was turning the wars in Iraq and Afghanistan completely over to them, allowing policy on troop levels to be set by the Pentagon. Civilian control of the military? Yet another constitutional principle apparently abandoned by Republicans in their reflexive support of Trump. Where this Republican support is coming from as Trump’s poll numbers head ever closer to 30 percent, and why it is still being given by Republicans on Capitol Hill in the face of one scandal after another, one insane tweet after another, is a question Republicans will have to answer sooner rather than later. It is regularly reported that it’s all about congressional Republicans just wanting to push through their so-called “conservative” agenda of tax cuts for billionaires and health cuts for the poor. But as that agenda has stalled, that excuse isn’t holding much water.
It’s becoming more and more clear that the crazed tone of Trump’s presidency is, as they say, a feature and not a bug of modern-day Republicanism. Conservative has become just another word for nothing left to lose. They have become the All-or-Nothing Party. They are showing every sign of being willing to go over the falls with Trump. With speculation rising about whether or not Trump will go all Saturday Night Massacre, fire Special Counsel Robert Mueller, and transform us overnight from a democracy into a totalitarian backwater, I guess we shall see. But whatever Trump decides to do in the coming weeks, the way the Republican Party is handling itself is going to stick to them for a long time. It’s going to be very, very hard to forget the image of a racist like Jefferson Beauregard Sessions laughing in the face of an African-American Senator like Kamala Harris as she’s being told to shut up and sit down. Those who kept their mouths shut and stood with Sessions at such a moment might keep their jobs for the time being, but they won’t keep their reputations.
We each have a sound track to our life. Songs that we may only hear once but at a time where we will remember them forever. Maybe a song that we have heard a thousand times but then it plays at a time where it leave a bigger impression.
Today is Father’s Day. I spent today at my lake house. I was packing up to leave when the song AVE MARIA came on. I turned it up and tears started welling up in my eyes.
The most beautiful version of this song was played at my Grandfather’s funeral. I was a pallbearer.
Now every time that song comes on, my heart breaks a little. I can feel the cold metal of the coffin in my left hand. I match my brother’s pace – staring at his back. I can feel my chest constricted with grief.
HuffPost spoke to two experts ― Farai Chideya, a journalist who has been reporting on white nationalism for more than 25 years, and Heidi Beirich, the head of the Southern Poverty Law Center’s Intelligence Project, who has been studying white extremist groups since 1999 ― to discuss the problem of white supremacist hate today, and how the media can do a better job covering it.
This is what the media should know:
1. White supremacist hate is not new.
“The one thing that bothers me the most about media coverage of these incidents is that they’re not frequently enough put in the context of the fact we’ve had ton of domestic terrorism recently,” Beirich told HuffPost.
“When it comes to Muslim terrorism, nobody questions it’s a problem that’s an ongoing threat ― a security problem, radicalization problem, et cetera ― which it is,” Beirich said. “But when it comes to Portland or Dylann Roof [the 2015 Charleston church shooter], they always seem to appear as one-offs.”
We began as a country that said ‘all men are created equal’ ― but there was slavery, and women were not allowed to vote.Farai Chideya
Americans “shouldn’t be surprised” by the frequency of white supremacist attacks, since they are rooted in a long history of racial discrimination, Beirich said. As she puts it, until the Voting Rights Act of 1965, “white supremacy was the law of the land.”
“I’m disturbed by this cycle [of attacks],” Chideya told HuffPost. “But we began as a country that said ‘all men are created equal’ ― but there was slavery, and women were not allowed to vote.”
“This is a continuation,” she added. “We’re not done, just because people are uneasy with how long the history is and how prevalent the issue is. We have to give up thinking this is rare.”
2. White supremacist hate is not “fringe.”
White supremacist hate doesn’t just manifest as violent extremism, Chideya noted.
“People frame it as weird guys with fringe beliefs ― no,” Chideya said. “White supremacists don’t just wear hoods and give Nazi salutes. White nationalists are in the U.S. government.”
She pointed to “institutionalized white nationalism, like voting laws,” mentioning North Carolina’s voting practices an example of “de facto white nationalism.” The courts recently found that the state’s legislative districts were drawn to intentionally disadvantage black voters.
Chideya also mentioned “political white nationalism, like in the White House,” calling out the links between the white supremacist movement and upper echelons of the federal government.
“In general, reporters need to become more adept at tracking not just extremist white nationalism, but also when it enters the mainstream, like in Montana,” Chideya said. “The same way you run a background check on politicians’ finances, run a check on if they are connected to extremist ideologies.”
“What is terrorism? Acts designed to inspire terror. But somehow, we don’t call this terrorism,” Chideya told HuffPost of the Portland attack. “When a Muslim terrorist kills one, two, five people, it’s immediately labeled terrorism. But when a white nationalist kills one, two, five people, it’s not labeled terrorism. But they’re the same.”
“We have to be aware as journalists of the labels we use,” she added.
The issue of how to label any given attack is complex. As CNN reports, for an attack to be labeled a hate crime, a perpetrator has to attack someone based on their identity ― for example, their race, religion, sexual orientation or ethnicity. For an act to be labeled terrorism, the perpetrator has to be motivated by political or ideological beliefs.
“Plenty of terrorists have had mental health issues,” Chideya told HuffPost. “There is a more general presumption that white people are good and innocent in American culture at large ― and journalists come from that culture.”
Beirich recognizes the issue, but she maintains that reporters need to pay more attention― not less ― to the issue of white supremacist hate.
“I know there are concerns about journalists who don’t want to report on a neo-Nazi rally where four people show up, because those groups are just seeking attention ― and that’s a valid point,” Beirich said. “But when we’re talking about domestic terrorism and hate crimes related to white supremacy ― that’s a real thing.”
“I understand not wanting to draw attention to small instances,” she added, noting specifically the series of news stories about white supremacist flyers on college campuses. “But when people are getting killed because of this, we’ve got to pay attention.”
When people are getting killed because of this, we’ve got to pay attention.Heidi Beirich
Deciding how much of a platform to provide extremists is an “inevitable transaction of journalism,” Chideya noted.
She recalled a time years ago when she was conducting a phone interview with a woman in the white supremacist movement. At the end of the interview, Chideya asked: “I’m black ― would you have granted me the interview if you’d known that?”
The woman responded: “Probably not ― but on the other hand, every time I talk to a reporter, people will read your article and come find me.”
“You can write a piece saying [white supremacists] are cowards, and there still will be people who come over to their side,” Chideya told HuffPost. “That doesn’t mean you don’t do journalism ― you just do it as well as you can.”
“It’s a question of journalism: Not every story is about Derek Black,” she said, referring to a man The Washington Post profiled after he left the so-called alt-right movement. “Nor about the worst violent person in the movement.”
5. White supremacist hate is a bigger problem than you think.
“Not only do we have domestic terrorism inspired by racism, but also we have a hate crime problem ― and the dimensions are not understood,” Beirich said.
If people were looking at these data points more, we would be talking about ways to combat this problem.Heidi Beirich
“If people were looking at these data points more, we would be talking about ways to combat this problem,” Beirich said. “This leads to less public policy interest in domestic terrorism committed by white supremacists ― and allows Trump to minimize these threats. We should not leave him off the hook.”
How did I get here? As my life ramped up to graduation day, the desire to just GO FAST, to feel the wind race past you with out knowing if you were running towards something or away. To just GO. To FLY. The way you feel when the rollercoaster car comes to the top of the first hill where the ride REALLY begins. What you want and what you are afraid to try for. Where you have been and where you want to go.
Yes- It was a VERY long time ago. A couple weeks ago I watched my daughter graduate from college. This time of year you can feel the excitement in the air that surrounds high school Seniors. It still feels like yesterday.
I left the town I graduated high school from the day after graduation. I have only returned maybe 3 or 4 times in the last 30+ years. The longer I am away the harder it is to even think about. I am sure a great many things have changed and yet many stay the same.
A recent wave of nostalgia accompanied has had me pondering why we sometimes think that what we left behind might contain something vital about who we are on the deepest level. If you feel something is missing in you, and you rediscover that what it is might be the very thing, people, family, culture you ran away from, then you are left with only one choice.
You must be able to create that “home” within yourself, and include both the old and the new, everything which made you then and makes you now, who you are. If you are running away, then you will never be at home but always running. If you stop and actually look at what you took leave from, see it for what it really is, see the people for who they truly are, and neither idealize not reject all of it, you may indeed be able to begin to make the first steps towards a new future that includes a whole and complete “You”.
You can in fact become your own “Home”. In fact, if you don’t, you are going to be a pretty lonely person, even if surrounded by millions.
One of the most important qualities to include during this process is Kindness, for yourself, for those places and people you took leave of, and for the people and places you have chosen to make your new life. Take a step back, which at times is both easier and harder to do from a great distance. Truly seeing the core of what makes the Past the past and your present reality the life you have chosen, and accepting both with all of the faults and parts which cause you to long for what you miss and still rub you the wrong way in your present, means being ruthlessly honest.
Why did I leave? Not just the place, but the people, the lifestyle, the culture and what had always been “Home”? Was it because of the judgments, all of those elements, which felt suffocating, which kept you from thriving and becoming the best you could be? Was it because there was hurt there which was not healed? Or was it simply that you did not ever feel really at home in the place where you were born, grew up, but where you know you can never be.
I have traveled to many parts of the world and part of me feels “at home” in each of the places. Iceland, Italy, Austria or Australia. I recall my first visit to meet family in Alatri Italy. As we drove into town I thought, “Finally, now I feel at home.” It was such a deeply intuitive feeling that I have never lost it. Yet I also realize that part of what I find to be familiar there, comes from the home I left behind. I have been able to take my children with me on many trips. On a visit to Italy with them I realized that the way my children grew up, was like the way I grew up in the US in the 1970s. There is less focus on stuff and more on community. Living in a relatively quiet town in New England the public schools are still extremely good and we are lucky to have a safe and peaceful place where children can play outside, travel across the city with no fear, and where people take time each and every day to live. And back in the place where I come from, old memories have become paved parking lots and the nostalgia I have is confronted with a new reality, which no longer has the texture of what I remember. There are still wonderful people and music and food and a few places, which have understood how to keep the ambiance alive. But yet another strip mall and shopping center do not make for any kind of deep feelings humans are capable of having towards a place. The nature we have been destroying will never be the same again. The history, which loses out to one more commercial venture, cannot be replaced.
There is something to be said for a view with no human interference, no buildings, no huge, waste of air-conditioning homes. Not everything need be a chain restaurant or store.
As my daughter recently said after a trip back to the US from New Zealand, “Dad people are so focused on money sometimes, they forget to live.” I grew up in a place where money mattered a great deal. People defined themselves not only by money but by what money could buy, be it social status, the stuff, the spouse, the lifestyle…When I was back there about 10 years ago, some old friends answered my naïve questions such as “Why did so and so marry so and so?” Their response, “The money!” I just could not believe that many people would actually make major life choices (which I naively still believe should be based on love) because of the money! I know I sound naïve, and I know people all around the world continue to make these choices, but I cannot believe that it makes for a better world. Some people back “home” were living and working in order to “make it” (i.e. make a lot of money) so that they could get on with their “real” lives. What’s the point? Your life is now.
I ran into a friend the other day who knew me while I was living back in NY and said “You walked away from a lifestyle most would die for…most people would not be able to walk away.” It did not feel right to me and I did not feel “at home”. Everything about me rejected all of that. I know a great deal of people who have walked away. People do it all the time. Maybe some call it a mid-life crisis when the man or woman looks around at their house, their life, and it all seems meaningless.
It is NEVER too late to make a difference. To feel the wind in your hair. And maybe it doesn’t matter of you are running away or towards something.
Right now I have sequestered myself at a cabin so I could finish some writing. I had to work on a lecture on ETHICS. As often happens in my research I get pulled down the rabbit hole. I get too deep and can get side tracked.
In our society there is a lack of REAL heroes. Why is it difficult for people to do the right thing AND when people make the right decision it is viewed as remarkable.
New Orleans Mayor Mitch Landrieu stood up last week and delivered a moving, bracingly honest speech to explain why he removed four Confederate monuments from his city.
“You elected me to do the right thing, and this is what it looks like,” Landrieu told the crowd gathered at New Orleans’ former city hall. “These monuments purposefully celebrate a fictional, sanitized Confederacy, ignoring the death, ignoring the enslavement and the terror that it actually stood for.”
While it was remarkable to see a Southern politician speaking boldly and clearly about race ― in the face of death threats and protests ― it was perhaps even more notable to see a leader publicly demonstrating the character of his convictions. Landrieu’s speech went viral.
As the country grows ever more cynical, divided and partisan, we’re not used to honesty and courage from our leaders. Seeing a politician stand up for what he or she believes is the right thing is increasingly rare.
Political discourse and civic life has so devolved in 2017 that a man charged with physical assault, Republican Greg Gianforte, was elected to Congress Thursday in Montana with the backing and full support of his party. Just the day before, Gianforte, a self-made tech millionaire, wrapped his hands around the neck of a reporter, threw him to the ground, and repeatedly punched him for asking a question.
Comparing a longtime politician in Louisiana (Landrieu comes from a political family and is a former lieutenant governor) to an upstart businessman-cum-politician may seem like a stretch. But these two men make a neat case study on the state of ethics and integrity in 2017.
These days the public no longer expects leaders to do what’s right. We’ve grown accustomed to name-calling and carefully crafted milquetoast middle-of-the-road statements. We’re used to lying, and we expect leaders to put party and their own careers before all else.
“Norms have shifted,” said Gautam Mukunda, the author of Indispensable: When Leaders Really Matter and a professor at Harvard Business School. “We expect leaders to be bad, and people live up to what you expect of them. We’ve created a self-fulfilling prophecy of bad behavior and it is profound.”
To many Americans, politics is either a massive conspiracy, a “House of Cards” dystopia, or a playground for craven buffoons, a la “Veep.” We are no longer surprised as we witness leaders live up to these expectations, lying about meeting with foreign agents, changing their stories, and blaming everyone but themselves when things go wrong.
You could see footprints of our lower standards all over the Gianforte incident. Instead of apologizing for his naked act of aggression, Gianforte initially released a statement blaming the reporter, Ben Jacobs of The Guardian. “It’s unfortunate that this aggressive behavior from a liberal journalist created this scene at our campaign volunteer BBQ,” the statement read.
Worse, the statement was false. It claimed Jacobs shoved the microphone in Gianforte’s face and refused to lower it after being asked, but audio and witness accounts from a Fox News crew refuted the claims.
Republican Speaker of the House Paul Ryan gamely admitted what Gianforte did was wrong, and called on him to apologize, but he also said would support his election if that’s what the people of Montana wanted.
Of course, we can’t actually know what the people in Montana thought of the assault. A majority of voters cast their ballots before the body-slam.
It’s easy to imagine a different politician simply stepping out of the race in the face of such an incident. Remember when Howard Dean appeared to scream in one speech and it doomed his entire bid for the presidential nomination?
Some conservative pundits tried to spin the assault this week as a good thing: “Gianforte, the manly and studly candidate, threw the 125-pound wet dishrag reporter from The Guardian to the ground,” Rush Limbaugh said of the incident, according to an online transcript of his show posted on his website. Laura Ingraham, while gamely allowing that politicians should stay cool in such situations, also tried to cast Jacobs as wimpy for not fighting back. What “would most Montana men do if ‘body slammed’ for no reason by another man?” she asked in a tweet.
As is too often the case in 2017, partisanship blinded us from even distinguishing right from wrong. The increasing divide between right and left and the intensely personal way each side attacks the other means that even ethics are now partisan. Republicans and Democrats call each other “bad” or “evil,” and there is often no higher playing field where everyone agrees to nonpartisan standards and values (don’t hit people, don’t lie, etc.).
“I don’t think Obama was perfect, but it’s hard to imagine more of a straight-arrow person. Not a hint of scandal,” Mukunda said. Yet somehow half of America just didn’t it see it that way. People who disagree with his politics won’t typically acknowledge that he acted with respect for the office. “You don’t hear a lot of that,” Mukunda said.
Yet at the same time, people are hungry for heroes ― men and women with humility who will stand up for what’s right. When former acting Attorney General Sally Yates refused to enforce President Donald Trump’s travel ban because she believed it was unconstitutional, many people found it thrilling. When Sen. John McCain (R-Ariz.) criticizes the Trump administration for its failings, he’s lauded.
Indeed, we need people like this to set examples, Mukunda says. “The extent that we have culturally deprived people of that is troubling.”
It’s also highly dysfunctional. Integrity is the bedrock of a properly functioning organization, Joseph Badaracco told HuffPost recently. Badaracco has been teaching an introductory course in ethics, leadership and accountability to Harvard Business School students for the past decade. He defines integrity as a consistency between what you believe, say and do. “It all hangs together,” he said.
“There’s a way in which integrity shouldn’t be newsworthy ― we assume it, rely on it and count on it,” Badaracco said. “It’s not exactly like obeying the laws of gravity, but we ought to be able to assume it’s there.”
The ability to know what’s right and follow through on it with conviction isn’t something Badaracco believes can really be taught to people by the time they reach Harvard Business School.
“We don’t teach people how to have integrity. Or even teach the importance of it,” he says. “If someone doesn’t understand that, they have a deficiency in their education or development and we can’t remedy that.”
Badaracco says his focus is on making hard decisions. The grey areas. “Not right versus wrong where a person with integrity will know what’s right,” he explains. “But right versus right where it’s not really clear.”
But civil discourse has devolved from this graduate-school-level thinking. Americans elected Trump, a man whose most original thinking seems to come through in his creative penchant for name-calling. Many mistook Trump’s plainspoken manner for authenticity, and perhaps conflated this with honesty and integrity.
The Glass-Steagall Act came up as a major point of disagreement between Bernie Sanders and Hillary Clinton during Saturday’s Democratic presidential debate. The Act, which was originally enacted in 1933, separated risky trading and investment from traditional banking activities like business lending and consumer finance.
1933. “Anthony Adverse” and “Magnificent Obsession” were topping the bestseller lists. “King Kong” and the Marx Brothers were big at the box office. What does a law passed back then have to do with the 21st century economy?
As it turns out, a lot.
Bernie Sanders wants to implement a new version of the Act, which was repealed in 1999 after having been in effect for more than 75 years. Hillary Clinton, on the other hand, is not calling for its reinstatement.
Sen. Sanders is right. Here are five reasons why it is important to reinstate the Glass-Steagall Act.
1. Too-big-to-fail banks are bigger, riskier, and more ungovernable than ever
America’s largest banking institutions are even larger now than they were before the 2008 financial crisis. The nation’s six largest banks issue more than two thirds of all credit cards and more than a third of all mortgages. They control 95 percent of all derivatives and hold more than 40 percent of all US bank deposits.
Simon Johnson, former chief economist for the International Monetary Fund, points out that Glass-Steagall is needed as part of a broad effort to make these banks “simpler and more transparent.” Johnson also observes that
“In the run-up to the 2008 crisis, the largest US banks had around 4% equity relative to their assets. This was not enough to withstand the storm … Now, under the most generous possible calculation, the surviving megabanks have on average about 5% equity … that is, they are 95% financed with debt.”
As Johnson makes clear, these banks continue to pose a grave risk to the economy. He also notes that they have continued to engage in sanctions violations and money laundering – behavior which suggests that they are still out of control.
2. The argument that Glass-Steagall didn’t cause the 2008 financial crisis is wrong.
Hillary Clinton told the Des Moines Register that “a lot of what caused the risk that led to the collapse came from institutions that were not big banks.” This is part of a longstanding pattern, in which she largely absolves the big banks from culpability for the 2008 crisis while emphasizing “shadow banking” in her own Wall Street plan.
Secretary Clinton returned to that theme during Saturday’s debate, pointing an accusing finger at non-bank entities like AIG and Lehman Brothers while giving a pass to Wall Street’s biggest banks for their role in the crisis.
Robert Reich, Bill Clinton’s former Labor Secretary, summarized the anti-Glass-Steagall argument as follows (without naming Hillary Clinton specifically):
“To this day some Wall Street apologists argue Glass-Steagall wouldn’t have prevented the 2008 crisis because the real culprits were nonbanks like Lehman Brothers and Bear Stearns.”
He follows that with a one-word response: “Baloney.”
Reich makes an important point: “Shadow banks” like AIG and Lehman, which largely function outside the normal bank regulatory system, are a major problem. But the 2008 financial crisis became a systemic threat specifically because too-big-to-fail banks were underwriting the risky bets these companies made. And why were the big banks able to do that?
Because Glass-Steagall had been repealed.
3. Repeal of the Act has not worked as promised.
Given the risks associated with the repeal of Glass-Steagall, what about the benefits? Turns out there aren’t many.
We were told that repealing Glass-Steagall would lead to more efficiency and lower costs, but neither of these promises has come true. No less an expert than John Reed, former CEO of Citigroup, now says those claims were wrong. Reed wrote in a recent op-ed (behind a firewall) that “there are very few cost efficiencies that come from the merger of functions – indeed, there may be none at all.”
In fact, says Reed, it is possible that this combination of functions actually makes banking services more expensive.
4. The repeal of Glass-Steagall is further corrupting the culture of banking – if such a thing is possible.
Sanders was right when he said on Saturday night that “the business model of Wall Street is fraud.” The traditional practice of what Sen. Elizabeth Warren calls “boring” banking – opening savings accounts, reviewing loans, and providing other customer services – has largely been supplanted by high-risk gambling and the aggressive hustling of dubious investments to unwary clients.
The level of fraud unearthed since the 2008 crisis is nothing short of breathtaking. (The fact that no senior banking executive has gone to prison for that fraud is, if anything, even more breathtaking.) How did that happen?
Citigroup’s Reed wrote that the repeal of Glass-Steagall led to the “very serious” problem of “mixing incompatible cultures” – which, he said, “makes the entire banking industry more fragile.” He discussed the relationship-based, sociable culture of traditional banking, emphasizing its incompatibility with the risk-seeking, “short termist” mentality of investment bankers who seek “immediate rewards.”
Reed makes a very important point – although he’s being overly kind about it. Yes, traditional bankers tend to be risk-averse and customer-focused. That’s very different from the high-stakes gambling mentality of investment banking.
But what Reed fails to note – or is too polite to mention – is the extent to which today’s culture of investment banking is predicated on outright fraud. That’s reflected in polling of the banking community itself, as well as in the industry’s appalling record of documented illegality. It is this mentality, which is present in banks from the “C” suite on down, which has given rise to Wall Street’s tsunami of misdeeds.
This greed-driven fraud mentality is like a virus, consuming too-big-to-fail banks even as they exert ever-greater control over our economy – and our political system.
5. Too-big-to-fail banks are a threat to our democracy.
These megabanks aren’t just a “systemic threat” to our economy. Through their enormous wealth, and because of the ruthlessness with which they’re willing to wield their influence, they are also a systemic threat to democracy itself.
That threat can be seen in the workings of last year’s Congress, which saw the successful insertion of a lobbyist-drafted “Citigroup amendment” into a last-minute budget bill.
Banks have acquired too much power. They must be broken up vertically (by line of business) and horizontally (by size), even as their corrupting influence over our government is ended through a system of fundamental election reform.
In today’s environment, reinstating Glass-Steagall is not just the right policy – although it is certainly that. It’s also an excellent litmus test for politicians who say they’re willing to take on Wall Street.